In the last 24-hours Bitcoin (BTC) toll dropped 10% today to test the $xxx,000 support. This drop beneath what traders have described as a 'cardinal' support occurred only two days ahead of this month's futures and options expiry.

Despite the record-high $four billion options decease being simply two days away, both bull and behave sides traded similar sizes today.

Different futures contracts, options are divided into two segments. Call (purchase) options allow the buyer to acquire BTC at a fixed price on the expiry date. On the other hand, the seller of the instrument will be obliged to make the BTC sale. More often than not speaking, they are used on either neutral arbitrage trades or bullish strategies.

The put (sell) options are ordinarily used as hedge, protection from negative price swings.

To empathize how these competing forces are balanced, one should compare the calls and put options size at each expiry price (strike). Options markets are all-or-none, significant they either take value or become worthless if trading above the call strike price, or the reverse for put option holders.

Aggregate options trade book in the by 24 hours. Source: Bybt.com

The trading volume over the past 24-hours has favored the more bullish call options past 51%. Even so, this number is polluted by the ultra bullish strikes priced at $37,000 and college. Considering there'due south less than 36 hours before the death, these contracts are trading below $50 each.

Excluding these over-optimistic strikes, today'south trading added another $95 meg worth of call options open up interest below $35,000. On the other hand, the more than bearish put options at $27,000 and college corporeality to $90 million worth of open involvement.

The result of today'southward action has been neutral for Friday's options expiry. Nevertheless, one should cheque the overall open interest imbalance divide from today's motion.

BTC January. 29 aggregate options open involvement by strike. Source: bybt.com

By excluding the put options below $27,000 and the phone call options above $35,000, information technology is easier to estimate the potential impact of Friday's expiry. Incentives to pump or dump the price by more than 16% get less likely, every bit the potential gains will seldom surpass the cost.

This data leaves $582 million worth of call options upward to $35,000 for the amass options expiry on Jan. 29. Meanwhile, the more than bearish put options down to $27,000 corporeality to $422 one thousand thousand. Therefore, at that place'due south a $160 million imbalance favoring the more bullish phone call options.

Because the volumes traded over the past 24 hours and the put options open interest, there's not much gain for bears in pressuring BTC below $29,000, at to the lowest degree from the options market standpoint.

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