Bitcoin’s (BTC) price has been trading above $22,500 for 12 days. Of course, this situation can change even if Federal Reserve chair Jerome Powell issues positive statements about the economy in today’s post-FOMC presser.
Even if the decision matches the market consensus, the post-meeting statement should be investors’ primary area of focus. Specific areas to focus on would be clues for the next meeting in March.
Troubling news for the largest stablecoin Tether (USDT) could also cause a meaningful impact after a Celsius bankruptcy examiner report showed that “Tether’s exposure eventually grew to over $2 billion” in September 2021. However, it is unclear if iFinex — Tether’s issuer — suffered any losses. iFinex chief technology officer Paolo Ardoino denied exposure to Celsius and suggested that the examiner had “mixed up” prepositions in the report.
Is a strong correction in stock market ahead?
Legendary portfolio manager Michael Burry, known for being one of the most vocal critics of the subprime mortgage crisis from 2007 to 2008, posted a short note on Twitter on Feb. 1, suggesting that investors “sell.”
While the message lacks a supporting thesis, one could conclude that Burry expects a meaningful correction in traditional markets. Considering the 40-day correlation between Bitcoin and the S&P 500 index at 75%, the odds of a BTC price retrace become evident.
Consequently, this week’s $1 billion BTC options expiry on Feb. 3 can go either way because bears can still flip the tables even though the tide currently favors the bulls.
Bitcoin bears were caught entirely off-guard
The open interest for the Feb. 3 options expiry is $1 billion, but the actual figure will be lower since bears were caught by surprise after the 9.6% rally between Jan. 20 and Jan. 21.
Bitcoin options aggregate open interest for Feb. 3. Source: Coinglass
The 1.61 call-to-put ratio reflects the imbalance between the $640 million call (buy) open interest and the $400 million put (sell) options.
If Bitcoin price remains above $23,000 at 8:00 am UTC on Feb. 3, less than $7 million worth of these put (sell) options will be…