Bitcoin (BTC) may experience increased volatility in the coming days amid speculation surrounding the announcement of another Chinese fiscal stimulus and the expiration of $1.1 billion in BTC options.

Chinese Stimulus Measures to Help Bitcoin?

According to the Information Office of the State Council, China’s Finance Minister Lan Fo’an does expected will provide details on upcoming fiscal stimulus measures during Saturday’s press conference. These activities are aimed at stimulating economic activity in the country.

On September 24, the People’s Bank of China (PBoC) cut interest rates on existing mortgage loans by 0.5% and lowered reserve requirement ratios for banks to escalate market liquidity.

The global cryptocurrency market is increasingly paying attention to China’s stimulus plans as increased liquidity could positively impact the prices of digital assets such as BTC.

While the announcement is expected, confirmation of another round of fiscal measures, especially if they exceed market expectations, could significantly escalate risks for assets like Bitcoin.

Furthermore, if the United States Federal Reserve (Fed) decides further cuts in key interest rates could escalate investor appetite for riskier assets, including digital currencies known for their volatility.

Currently, forecast markets are speculating that there will be at least another 50 basis point (bps) interest rate cut by the end of the year. Such a move would escalate global liquidity and lend a hand BTC to avoid capitulation, which could cause the price to drop to the high 40,000 range. dollars.

The expiration of BTC options may cause price volatility

Another factor that could impact Bitcoin price volatility is the $1.1 billion worth of 18,000 BTC options set expires October 11. At the time of publication of the report, the put ratio is 0.91, indicating a slight tilt towards puts.

With Bitcoin hovering around $60,000, the chances of hitting a “top price” of $62,000 are increasing. For the uninitiated, “maximum pain” refers to the price level at which most option traders are likely to suffer losses.

While Bitcoin has recently benefited from global interest rate cuts, geopolitical tensions in the Middle East and uncertainty around November’s U.S. presidential election have made it complex to predict BTC’s future price movement.

Despite the above challenges, some trading firms and cryptocurrency analysts are confident in the resilience of digital assets and the growth potential of cryptocurrencies in the fourth quarter of 2024.

For example, cryptocurrency trading company QCP Capital excellent that Bitcoin’s rapid recovery after Iran’s offensive against Israel indicates its high demand among investors.

Likewise Bitwise CIO Matt Hougan scratched three main factors that could lend a hand the BTC price “melt” to a novel all-time high (ATH) of near $80,000 in the fourth quarter of 2024. At press time, the BTC price is $62,086, an escalate of 2.7 % in the last 24 hours.

Featured image from Unsplash, chart from Tradingview.com