Bitcoin (BTC) Dips Below $102,000 Ahead of Friday's Weekly Options Expiry

Bitcoin (BTC) dropped under the $102,000 level, once again raising questions about the short-term direction of the rally. Friday's weekly options expiry event may be the main factor for price turbulence.

Bitcoin (BTC) price dropped below the $102,000 mark on Thursday, May 15, once again raising questions about the short-term direction of the rally.

The main factor for the turbulence in the BTC price may be the upcoming weekly options expiry event on Friday, May 16, at 08:00 according to the cryptocurrency exchange, Deribit.

The options traders on the exchange will be rolling over their positions, which may influence the price action. The majority of the options contracts are concentrated at the $100,000 strike price, which is also the maximum pain level for options holders.

This week's options expiry event is showing more bullish confidence compared to other options expirations, with the put/call ratio being bullish for both BTC and ETH, but still showing some caution regarding the potential for price drops.

As the Bitcoin price continues to determine its direction and potential to move to a new all-time high, the options events are being closely watched by traders.

BTC price drops as traders prepare for options expiry

The cryptocurrency exchange Deribit is known for its large options market, with traders placing bets on the price of BTC and other cryptocurrencies at a specific time in the future.

According to the latest data from the exchange, over $3.1B in BTC and ETH options are set to expire on Friday, May 15 at 08:00.

The majority of the options contracts are concentrated at the $100,000 strike price for BTC, which is also the maximum pain level for options holders.

According to the latest data from Glassnode, the BTC price is threatening to liquidate long positions. At the price of $101,456.40, traders have accumulated $48.3M in long positions, which are now in almost immediate danger of being closed or liquidated.

The bigger risk is a break below $101,000, at which point liquidations may reach up to $996M. The actual availability of liquidity may change as traders close out their positions, and a price sweep to liquidate the remaining long positions is still possible.

Another potential scenario is a climb above $103,000, where short positions are accumulating. A short squeeze may lead BTC to its higher price range, avoiding the maximum pain of options expiry.

According to the analysis, BTC is also expected to reject the higher price levels and drop as low as $99,000 before reclaiming a higher level.

Based on the liquidation levels, the biggest accumulation of short positions is just under $105,000, which are awaiting rejection, with some accumulation below the $106,000 level.

Despite the recent price downturn, BTC is still seeing increased spot demand, accumulation by funds and retained block rewards in the wallets of miners. In the short term, the direction of the BTC price may change more actively.

The dominance of BTC fell to 59.4%, down from a recent high above 61%. BTC is still the leading asset, outperforming all other altcoins. ETH recovered only slightly to 0.025 BTC, but is suffering from similar levels of volatility.

Ahead of the options expiry, ETH traded at $2,525.68, once again revealing that its rally above $2,700 was short-lived. ETH is farther from its maximum pain level of $2,200 on the options market, but may still face pressure to go lower.