Bitcoin Clocked $93k. Will It Continue Upwards?

Bitcoin surged to a high of $93,330 a few hours ago. However, it retraced, trading slightly lower at the time of writing.

The latest hike has not received as much attention as many would expect, given that it happened earlier in the day. The 4-hour chart indicates that the surge occurred in the session starting at 12:00 UTC. Nonetheless, while the reaction trailing the latest hike is minimal, traders are waking up to their positions being liquidated.

Data from Coinglass shows that total liquidations during that 4-hour surge exceeded $140 million, with shorts accounting for more than $132 million. Prices have slightly retraced, resulting in a $25 million loss, with longs accounting for most of it during the following 4-hour session.

However, investors have been skeptical about the recent hike. The 1-day chart shows that the apex coin has printed green candles over the last 4 days and decisively broke above $90k, liquidating over $200 million in shorts on Friday.

At the current price, BTC has gained over 6% in almost five days. However, questions about why prices surged hang in the air.

Options Played a Huge Role

While explaining price movements on Dec 30, one analysis noted that the earlier surge that day was due to options traders buying spots to push prices higher and predicted corrections the next day.

BTC retraced as expected. However, the article added that there were other options expirations on Jan 1 but stated that prices may not react. The max pain price for this expiry was $90k. Prices reacted, and the options terminations, coupled with other factors, were the catalysts.

As last week, options are still in play on Monday. The market awaits the expiration of over $287 million, and the bulls account for the highest volume amid higher puts. The option data explains why Monday’s surge occurred amid weak fundamentals.

Nonetheless, the Greek table tells why the asset retraced after breaking above $93k. With max pain at $90k, current prices indicate that the bulls are in profit. The delta table is currently negative, suggesting that market makers are also positive at $92k. However, it flipped positive at $93k, prompting MMs to short the asset, which explains the rejection at the mark.

Bitcoin may hover between $92k and $93k before the option expiry, which could happen in the coming hours.

Will Bitcoin Surge Higher?

There are several other option expiries, with max pain price at $92k. However, they are smaller than Monday’s. It remains to be seen if investors will continue react to them. If that happens, the apex coin will attempt $94k this week.

Nonetheless, a look at the US economic calendar indicates several other catalysts that could facilitate further surges in the coming days.

While several indicators and markets are bullish, the derivatives market is seeing reduced participation. Data from CryptoQuant reveals that open interest dropped by over 3% and funding rates plummeted by 13%. Although sectors see slight involvement over the weekend, prices and this metric tend to increase in such situations.

Rising open interest usually indicates more traders and volume, which is healthy for the overall market. However, a drop in this metric would mean less participation and higher price volatility.

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