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24 February 2021

Here’s how pro traders use options to profit from Bitcoin price corrections

Here’s how pro traders use options to profit from Bitcoin price corrections


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For example, a March 26 put option with a $56,000 strike trades at $5,300, and its holder would only profit if BTC trades below $50,700 in 32 days.

The trader would not incur any losses, but would also not profit from the strategy.

In order for the trader to incur a $5,000 loss, BTC would have to reach $69,000 on March 26, which is equivalent to a 20% gain from the current price.

Therefore, even though this is a bearish strategy, traders would only incur losses above $64,000, or 11% above the current price level.

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