Bitcoin Predictions Based on the Options Market
Lyra, an options and futures exchange operating on the decentralized blockchain Lyrachain, holds significant insights into the future price movements of Bitcoin. According to DeFiLlama data, Lyra is currently the largest decentralized exchange in the world for crypto options, boasting approximately $32 million in daily global volume.
Options expirations on Lyra are scheduled every Friday until the end of March, with additional expirations set for the end of April. The current price range for Bitcoin options expiring today hovers between $45,000 and $60,000, while next week’s expirations extend from $40,000 to $62,000. Given Bitcoin’s current price slightly below $52,000, today’s expirations appear balanced. However, next week’s expirations are slightly skewed towards a downside movement.
When considering options starting from March 8th, the range extends from $48,000 to $60,000. Interestingly, short-term bets dominate the platform, suggesting a negative sentiment in the short term and a more neutral outlook in the medium term. As deadlines extend further into the future, uncertainty increases significantly. By the end of March, the range widens to $34,000/$68,000 and further expands to $32,000/$70,000 by the end of April.
The $70,000 Target for Bitcoin Options
Lyra’s founder Nick Forster points out that there is a 20% probability on Lyra for Bitcoin to reach new all-time highs by April 26th with a price exceeding $70,000. While this percentage may seem low and data suggests a potential drop to $34,000 during this period as well, it’s essential to acknowledge that speculators correctly positioned themselves on Lyra during Bitcoin’s recent rise above $50,000.
Overall sentiment on Lyra appears bullish; however, it is crucial to consider that there are still two months until the halving event. Forster highlights trading activity focusing on a potential increase towards prices of $64,000 and specifically $70,000 by April 26th expiration.
Fourth Halving Coming Up
The April 26th deadline marks an important milestone as it is expected to be the first post-halving period. While the exact timing of the halving remains uncertain at this point, it is likely to occur around mid-April before the aforementioned deadline. This anticipation could explain why speculators are not particularly bullish in the short term but become more so as March progresses and especially leading up to April.
It is worth noting that despite high Bitcoin mining hashrates which shorten block times and potentially expedite the halving process by one or two weeks earlier than expected.
The Possible Sell-the-News Scenario
Despite optimistic predictions leading up to the halving event with potential price peaks at $64,000 or even $69,000 before retracement due to “sell-the-news” phenomenon remains a possibility post-halving. The figures of $64,000 and $69,000 hold significance as historical peaks for Bitcoin in 2021; hence traders use them as reference points.
The possibility of short-term retracement must also be considered in light of potential changes in speculators’ forecasts on Lyra. It is important to recognize that while these predictions offer valuable insights into market sentiment and potential price movements based on options trading data,
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