Over the past 2 weeks, Bitcoin price appears to take lost momentum and some analysts are suggesting that bears volition be in control for the foreseeable time to come.

Taking a look at derivatives marketplace information provides a clearer picture of what is happening on the institutional side and how the moves of larger players may affect the spot markets.

Subsequently peaking at $10.6 billion on Jan. 14, the open interest on Bitcoin (BTC) scaled back to $8.4 billion. The Jan. 29 monthly expiry continues to stand apart, totaling 47% of the options in play.

Although a $four billion expiry could be significant, i must consider that these options are divide amongst calls (neutral-to-bullish) and the more than bearish put options. Furthermore, having an opportunity to buy BTC for $52,000 on January. 29 might have made sense a couple of weeks ago, but non and then much right now.

BTC options aggregate open interest. Source: Bybt.com

As the data above depicts, Deribit exchange remains the absolute leader with an 83% market share. Yet, to understand how eventful this expiry could exist, one must accommodate data and compare both calls and put options near the current $32,000 BTC level.

It's too early to panic

Most exchanges offer monthly expiries and some also hold weekly options for short-term contracts. December. 25, 2020, had the largest expiry on tape as $ii.4 billion worth of pick contracts expired. This figure represented 31% of all open interest and showed how options are commonly spread throughout the year.

Amass BTC options open up interest past expiry. Source: bybt.com

Information from Bybt.com shows that January. 29 expiry calendar accounts for 107,000 BTC. This death engagement represents 45% of the aggregate options market open interest.

It is worth noting that non every option will trade at decease as some of those strikes now audio unreasonable, especially considering at that place are less than five days left.

BTC January. 29 aggregate options open interest by strike. Source: bybt.com

As Bitcoin marked its new $42,000 all-time high, some ultra bullish call options were traded but equally BTC cost adapted, those short-term options became worthless.

Currently, over 68% of Jan. 29 phone call options at $40,000 and in a higher place should be disregarded for adding. The same can be said for the bearish put options at $25,000 and below. These correspond 76% of the open up involvement.

This data leaves an estimated $745 million worth of call options below $40,000 for the aggregate options death on Jan. 29. Meanwhile, the more bearish put options in a higher place $25,000 corporeality to $300 million. Therefore, the adapted Jan. 29 open up interest stands at $one.05 billion while holding a 0.40 put-to-phone call ratio.

Skew shows marketplace makers are unwilling to take upside hazard

Analyzing open interest provides information from trades that take already passed, whereas the skew indicator monitors options in existent-time. This gauge is fifty-fifty more than relevant as BTC was trading below $23,500 but thirty days agone. Therefore, the open up interest well-nigh that level does not indicate bearishness.

When analyzing options, the thirty% to 20% delta skew is the unmarried nigh relevant gauge. This indicator compares call (buy) and put (sell) options side-past-side.

A 10% delta skew indicates that call options are trading at a slight premium to the more bearish/neutral put options. On the other hand, a negative skew translates to a higher cost of downside protection and is a signal that traders are surly.

Deribit Bitcoin options xxx-20% delta skew. Source: genesisvolatility.io

According to the data shown above, the concluding time some bearish sentiment emerged was January. 10, when the Bitcoin price crashed by 15%. This move was followed by an farthermost 30% to twenty% delta skew as optimism reached 49, a level unseen over the previous by 12 months.

Whenever this indicator passes xx, information technology reflects fear of potential price upside from market makers and professionals, and is considered bullish. On the other paw, the electric current 0 to 10 range that held since Jan. 20 is accounted neutral.

While a $4 billion options death might be worrisome, nearly 74% of the options are already deemed worthless. Regarding the January. 29 expiry, bulls remain mainly in command due to its much larger adjusted open involvement.

Bears are reasonably comfortable at $32,000

January. 29 BTC aggregate options open up interest per strike. Source: Bybt.com

Despite bulls having an overall advantage, the more bearish put options boss expiries between $33,000 and $35,000. Nevertheless, this ane,200 BTC contract advantage is more than kickoff past the 1,950 BTC contract imbalance favoring the call options from $28,000 to $32,000.

To conclude, equally things currently stand, bulls seem in total command of Fri's expiry, although incentives between $28,000 to $35,000 are reasonably balanced. Overall in that location'southward not much to proceeds from either side to create additional volatility ahead of Jan. 29.

The views and opinions expressed here are solely those of the autho r and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. Yous should carry your own research when making a conclusion.