7.9 billion US dollar Bitcoin options expire this Friday! The biggest pain point is at 71k, could a short squeeze show be in the cards?

Bitcoin is set to settle $7.9 billion in options, with the market focusing on the battle at $62,000 and $75,000. Currently, the bulls are heavily betting on call options at $75,000.

The cryptocurrency market is about to usher in a major turning point. This Friday, nearly $7.9 billion worth of Bitcoin options will expire and settle on the Deribit platform. The latest distribution of open interest shows that market funds are densely positioning around the two key strike prices of $62,000 and $75,000, signaling a tug-of-war between bulls and bears has begun.

According to on-chain data analysis firm Glassnode, $75,000 is the main hub where the bullish camp is heavily betting on “call options” (call options, bullish choices). As of now, open contracts at this strike price amount to $395 million.

Image source: Glassnode

More caution is warranted at the $75,000 level, where “Gamma Exposure” shows a deep negative value. In financial markets, this indicates that market makers, for hedging purposes, tend to operate under a “chasing gains and cutting losses” logic. When the price rises, they must buy more Bitcoin; when the price falls, they need to sell more. This force will further amplify market volatility, making the vicinity of $75,000 an extremely turbulent “eye of the storm.” When the price approaches this level, even more intense fluctuations could occur.

On the downside support, open interest in “puts” (put options, bearish options) representing downside protection is concentrated at $62,000, with a total contract value of about $330 million. This forms the main support zone for Bitcoin during a pullback.

At the intersection of bullish and bearish forces, the “max pain price” for this expiration is at $71,000. The “max pain” is the price at which the most traders would suffer financial losses at expiration. Historical experience shows that as settlement approaches, the price often gravitates toward the “max pain” point.

Currently, Bitcoin is trading above the “max pain” level of $71,000, and the next test will be whether the bulls can hold onto their gains.

In addition to the options market, the undercurrents in the futures market are also not to be ignored. Currently, the funding rate for perpetual contracts remains negative, indicating that the market is accumulating a large number of short positions. If Bitcoin can hold above the $75,000 level, these short sellers will be forced to buy back Bitcoin to close their positions, further fueling upward momentum and igniting a “short squeeze” rally.

• This article is reprinted with permission from: “Block Beast”
• Original title: “79 Billion USD BTC Options Expiring! Market Focuses on ‘Two Key Levels’, Max Pain at $71,000”
• Original author: Block Sister MEL