View on market
BTC remains under the control of the $61,700 supply zone, with demand zones breaking on lower time frames and no bullish boost from recent 13F filings, signaling potential further downside.
Bear Put Spread
The proposed strategy is a Bear Put Spread. A Bear Put Spread is achieved by simultaneously buying a Put option and selling a Put option at a lower strike price but with the same expiration date.
You might consider initiating this trade if you feel BTC will face resistances and may trade lower.
Trade Structure
(OTM Put) Buy 1x BTC-21AUG24-$57,500-P @ $412
(OTM Put) Sell 1x BTC-21AUG24-$56,500-P @ $207
Target: Spot level < $56,500
Payouts
Maximum Profit: $795/BTC
Debit of Strategy : $205/BTC
Why are we taking this trade?
In my recent insights, I’ve pointed out that Bitcoin is currently held back by the supply zone around $61,700. This has led to the breakdown of demand zones on lower time frames, as seen in the attached 2-hour BTC chart. Additionally, despite the latest 13F filings from major asset managers showing exposure to Bitcoin Spot ETFs, there hasn’t been a significant boost in bullish sentiment. As a result, Bitcoin’s price may continue to face resistance from the higher time frame supply zone, potentially leading to further downside movement.
Hence, traders might consider deploying a Bear Put Spread strategy to capitalize on the anticipated price movement.
To execute this strategy, traders can buy a Put option of a lower strike price, eg. $57,500 while simultaneously selling a Put option of an even lower strike price, like $56,500.
If BTC prices are at or below $56,500, when the options expire on August 21st, traders will achieve maximum profit from this strategy.
In case of market upturn, the maximum loss is limited to the initial debit of $205.
How to take this trade on Deribit?
Step 1: Go to Combo books under the Strategy tab & Create combo.
Step 2: Click RFQ and send your order to the Combo List.
Step 3: Go to Combo list (BTC), click on your Strategy and execute.
Disclaimer
This report must not be used as a singular basis of any trading decision. The document includes analysis and views of our research team. The document is purely for information purposes and does not constitute trading recommendation/advice or an offer or solicitation of an offer to buy/sell any contract.
