First Mover: Bitcoin Options Market Eyes $4.2B Expiry on Friday
  Everything you need to make sense of the crypto markets and beyond By the CoinDesk Markets Team Edited by Lawrence Lewitinn, Managing Editor, Global Capital Markets April 27, 2021 Sponsored by  (Price data as of April 27 @11:00 UTC) If you were forwarded this newsletter and would like to receive it, sign up here.
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Market Moves by Omkar Godbole  Bitcoin Options Market Eyes $4.2B Expiry on Friday
Bitcoin has begun the monthly options expiry week on a positive note, rising from $48,000 to over $54,000.
Further gains may remain elusive for a while or unfold at a slower pace, as the max pain point for Friday's $4.2 billion options expiry is $54,000.
Call and put sellers, typically institutions with ample capital supply, often push prices of the underlying toward the max pain point while heading into the expiry.
Doing so means that maximum amount of options expire worthless. Thus buyers lose maximum money (that is, the premium paid) while purchasing options, while sellers (the recipients of premium) make the most.
In other words, buyers of call and put options expiring on April 30 will suffer maximum loss if bitcoin (BTC) settles at $54,000 on Friday. Meanwhile, sellers would make the highest profit. Therefore, it's in the interest of most option writers (sellers) to keep prices around $54,000.  Bitcoin options: Max pain point as per Deribit, the largest crypto options exchange by volumes and open interest (Source: Deribit)
It is difficult to prove whether max pain pinning is real or coincidental, as bitcoin's options market is still relatively small for the expiry to have a sizeable impact on the spot price.
At press time, the total number of outstanding bitcoin options contracts – or open interest – is around $13 billion or 1.3% of bitcoin's total market capitalization of $1.03 trillion, according to data source Skew.
Further, only 77,000 contracts worth $4.2 billion are set to expire this Friday. That's 0.3% of bitcoin's market capitalization.
Nevertheless, traders can benefit from keeping an eye on the max pain, especially as expiry nears.
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Technician's Take by Damanick Dantes Bitcoin Rallies From Oversold Levels; Resistance Around $56K
Bitcoin (BTC) is roughly 16% higher off the weekend low around $47,000 as buyers responded to oversold conditions. The cryptocurrency was trading around $54,700 at the time of writing. The next level of resistance is around $56,000.
 Hourly BTC chart shows support and resistance levels with overbought RSI (Source: TradingView)
Original story found here: Bitcoin Rallies From Oversold Levels; Resistance Around $56K
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