Bitcoin’s Surprising Surge
Just about a month ago, the idea of Bitcoin (BTC) soaring to $32,000 seemed as plausible as my grandma winning a dance-off on TikTok. The price was lounging comfortably at $13,300 as of late October, making that leap to the $32k mark look like an ambitious Olympic high jump.
The Options Market: A Rollercoaster of Gains
Fast forward to today, and those once humble January $32,000 call options that traded for a modest $67 are now enjoying the good life at $705. Talk about a glow-up! That’s nearly a 10-fold increase in less than four weeks, which means if you had invested in those options, you might be celebrating Christmas in July.
Volatility: The Name of the Game
Even as BTC rides the crypto wave, it’s worth noting that the implied options probability—also known as delta—sits at a cool 11%. This means the market is somewhat skeptical about reaching that peak. With increasing volatility, where Bitcoin price swings are as common as your favorite sitcom reruns, sellers are demanding higher premiums due to the added risk. In case you didn’t notice, BTC’s volatility skyrocketed from 57% to 78%, suggesting that the market loves to keep us on our toes.
Long-Term Betting: A Smart Strategy
Now, before diving headfirst into the options pool, let’s address something important: don’t take those probabilities at face value. The distant expiry dates of options can turn your $32,000 dream into a pumpkin if you’re not careful. Take a look at the Dec. 25 call options for $20,000—those odds might seem low at 26%, but remember, just because it seems dim doesn’t mean it can’t happen. After all, 2020 already feels like a wild year where everything can flip on its head in mere seconds.
Conclusion: Cherish the Journey, Not Just the Destination
So what’s the takeaway? Buy those call options with longer expiry dates and keep the faith. Those who dared to think BTC could rise 150% last month are likely feeling pretty smug now. Whatever you choose, just remember that every investment comes with its fair share of risks—so do your homework and prepare for the unexpected.
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