Following strong fluctuations in the cryptocurrency market in recent weeks, new assessments regarding the Bitcoin trend continue to emerge. According to research firm 10x Research, the dynamics of the options market, which accelerated Bitcoin’s decline two weeks ago, could now work in the opposite direction, contributing to a rise in prices.
The analysis, shared by the company on its X platform, indicates that mandatory hedging trades in the options market increased selling pressure during the period when Bitcoin fell below the $70,000 level. These mechanical sales worsened the decline and contributed to the fall in the price of Bitcoin to $65,705.
However, according to 10x Research, current market conditions have changed significantly compared to the previous period. The analysis indicates that a negative gamma strike price of around $1.8 billion has formed, close to Bitcoin’s current price level. This indicates that the options market is undervaluing true volatility.
The research firm said this structure could create a positive environment for Bitcoin, noting that if prices start to rise, options market participants could be forced to buy to balance their positions. In such a scenario, it has been argued that mechanical buying could further strengthen the upward movement.
10x Research also believes that the observed improvement in investor sentiment could support prices. In particular, expectations of a possible peace agreement between the United States and Iran reducing geopolitical risks, and expectations that the US Federal Reserve (Fed) may pursue a more accommodative monetary policy in the future, are among the factors that could increase interest in risky assets.
Analysts note that Bitcoin is technically trying to break out of oversold territory after its recent sharp sell-off, but point out that a stronger recovery could occur in the near term if the options market reverses its direction.
However, experts stress that options purchases alone are not enough to signify a sustainable bull market and that investors should closely monitor fundamental indicators such as macroeconomic developments, ETF flows and institutional demand. Nonetheless, the current outlook suggests that there are growing factors indicating that Bitcoin could gain room for an upward move in the near term.
*This does not constitute investment advice.
