Using a Bear Call Spread to Trade Bitcoin Resistance

Summary

This trade example uses a bear call spread to express a moderately bearish view on Bitcoin after a rally to new highs. The position sells a March 17, 2024 call at 72,500 and buys a call at 74,000, collecting a stated net credit of $150 per BTC. The setup is motivated by a breach of four-hour support and a developing resistance zone near 72,400, with the target that spot remains below the short strike at expiry.

The spread limits the maximum loss to the difference between strikes less the credit received; the document gives that risk as $1,350. It also outlines how to assemble and execute the combo order on Deribit. The rationale rests on a particular chart reading and a single market snapshot, with no historical performance analysis or probability estimate. The example is educational and does not establish that resistance will hold or that the trade suits other market conditions.

Key ideas

• A bear call spread combines a short lower-strike call with a long higher-strike call.
• The example collects a $150 per BTC credit for the March 17, 2024 spread.
• The stated maximum loss is $1,350 per BTC if the position reaches its worst-case expiry payoff.
• The trade thesis relies on a recent support break and resistance near 72,400.
• The article describes placing both option legs as a combo order.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.