October 25, 2021

This bullish Bitcoin options strategy lets traders speculate on BTC price with less risk

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Historical data shows that it is nearly impossible to consistently predict Bitcoin’s price action and many traders that attempt this end up losing money. Now that Bitcoin trades near $50,000, the ultimate goal for most traders is to hold on to their current holdings and incrementally add to them in a way that is not terribly risky. 

Options strategies provide excellent opportunities for traders who have a fixed-range target for an asset. For example, using leveraged futures contracts might be a solution for a scenario where one expects a price increase of up to 28% over the next month. Of course, using a tight stop loss lessens the viability of the trade.

On the other hand, using multiple call (buy) options can create a strategy that allows gains that are four times higher than the potential loss. These can be used in both bullish and bearish circumstances, depending on the investors’ expectations.

The long butterfly strategy allows a trader to profit from the upside while limiting losses. It’s important to remember that options have a set expiry date; therefore, the price increase must happen during the defined period.

The Bitcoin (BTC) calendar optionsTitle: This bullish Bitcoin options strategy lets traders speculate on BTC price with less risk
Sourced From: cointelegraph.com/news/this-bullish-bitcoin-options-strategy-lets-traders-speculate-on-btc-price-with-less-risk
Published Date: Sat, 27 Feb 2021 20:30:00 +0000