Bitcoin Options Traders Focus on Bullish Calls Above $80K

According to an analyst, bitcoin options traders are increasingly focusing on calls for strike prices above $80,000 for options expiring in November. This shift comes as the market anticipates two significant events next month: the U.S. presidential election on Nov. 5 and the Federal Open Market Committee’s (FOMC) interest rate decision on Nov. 8.

The current highest bitcoin options open interest is for options expiring on November 8, coinciding with the FOMC meeting and days after the U.S. election. There’s a clear bias towards call options, supporting the hypothesis that traders are generally positioning for a bullish outcome, according to André Dragosch, head of research for Europe at Bitwise.

Call options are perceived as bullish, allowing traders to buy bitcoin at a predetermined price before a set expiration date. If traders believe bitcoin's price will rise, this strategy enables them to secure a lower price now and profit if the price increases later.

The U.S. Federal Reserve is expected to announce a 25 basis point cut to the federal funds rate during its November 8 meeting. The CME FedWatch tool indicates a 90.2% probability of such a rate cut, which could increase risk appetite in broader markets, prompting traders to position accordingly in cryptocurrencies.

> “Option traders seem to be anticipating an uptick in bitcoin’s volatility around the time of the FOMC decision, as evidenced by the term structure of implied volatility for options expiring around that date,” Dragosch noted.

Concentration of Call Options for November’s End

There is a significant concentration of call option contracts expiring on Nov. 29, per Deribit data. Over 3,100 call options with strike prices ranging from $80,000 to $82,000 have been opened for November's end-of-month expiry, representing a notional value exceeding $212 million. In contrast, there are only 1,200 put options, totaling a notional value of $82 million, reinforcing the market’s bullish stance for November.

Despite the positive sentiment towards bitcoin's price trajectory at November's end, some traders are hedging, evidenced by an increase in put open interest.

> “There was some hedging activity based on a recent increase in put open interest, associated with an increase in the relative put/call open interest ratio,” Dragosch explained.

Deceleration in Bitcoin ETF Inflows

Bitcoin's price surged to around $69,400 early on Monday but pulled back to approximately $68,200 as of this writing. The digital asset has struggled to cross the $70,000 threshold, despite last week’s record milestone for spot bitcoin exchange-traded funds (ETFs), which have now surpassed $20 billion in total net inflows just ten months after their debut.

After averaging $420 million in daily inflows over five days, bitcoin ETFs concluded last week with a notable decline to $273 million in inflows, according to data from Farside Investors.

> “While institutional support remains robust, this deceleration in inflows suggests that momentum could weaken further if capital does not begin to flow back into the market in the coming days,” said BRN analyst Valentin Fournier.

Fournier added that technical indicators are signaling a slowdown in momentum, suggesting that bitcoin may consolidate at this level before an upward push.

> “As bitcoin consolidates above $68,000, we may enter a quieter phase with lower volatility, potentially leading to renewed acceleration. However, we remain optimistic about medium-term bullish momentum and do not anticipate a trend reversal,” Fournier concluded.