While gold keeps setting new records, Bitcoin 
$78,258 remains in a narrow trading range as the Christmas week approaches. The Singapore-based cryptocurrency market maker QCP highlights that reduced liquidity ahead of the holiday and year-end corporate leverage reduction contribute to the sideways price movements. According to QCP, open positions in the BTC and ETH perpetual futures markets have decreased by approximately $3 billion and $2 billion, respectively. The company states that risk reduction is progressing rapidly without any significant reorganizations. Analysts expect the volatile and directionless trend to continue until the year’s end unless a clear breakout occurs.
Liquidity Contracts Ahead of Holiday Season
QCP’s market assessment emphasizes the significant contraction in market depth as the Christmas holiday approaches. With investors closing positions, the open position value in the BTC perpetual futures market has decreased by approximately $3 billion overnight, and for ETH, the decrease has reached around $2 billion. Despite the appearance of reduced leveraged risk, the company notes the high potential for squeezes in either direction due to declining liquidity depth.
The historical pattern supports fragility as Bitcoin frequently fluctuates between 5% and 7% during the Christmas period. QCP emphasizes these movements are more often linked to year-end option expiry flows than new underlying catalysts. Despite reduced leverage use, shallowing liquidity sets the stage for intensified short-term price swings.
According to the company, as the year-end approaches, the market is more focused on position cleanup than seeking direction. Therefore, a market structure characterized by band volatility prevails without a clear breakout signal.
Record Option Expiry and Tax-Induced Selling Pressure
The critical headline for the current week is the record options set to expire on Friday. Data indicates that around 300,000 BTC options contracts (approximately $23.7 billion) and 446,000 IBIT options contracts will expire simultaneously. This suggests that flows could be decisive for pricing. QCP reveals that the Boxing Day expiry accounts for over 50% of the total open position value on Deribit, with options concentration around strike prices of $100,000 and $85,000, and the maximum pain level clustered around $95,000.
Analysts also highlight a noticeable shift in position distribution. With the spot price stabilizing over the weekend, the open put position at $85,000 decreased from about 15,000 to 12,000, while the open call position at $100,000 remained relatively stable at around 17,000. QCP associates the $100,000 Call side predominantly with a “call condor” setup, which, while looking speculative, reflects limited optimism towards a Christmas rally.
According to QCP, there are signals of reduced stress in the options market. BTC risk reversal indicators suggest a less negative tone compared to the past 30 days. Although the curve still shows a limited put skew, normalization is progressing toward early October levels. QCP mentions that actions post-Friday’s expiry, especially regarding whether the $85,000 puts will be rolled forward, closed, or shifted to lower strike prices, will dictate the clarity of the downside positioning.
As the year’s final days approach, an additional crucial factor is the December 31 tax calendar. Analysts remind that, unlike the “wash-sale” rules observed in equities and ETFs, cryptocurrency market investors can realize losses and quickly reposition. This behavior has the potential to increase volatility in shallow market conditions in the short term rather than suppress it. Nonetheless, it is noted that Christmas week movements historically trend towards reversal in January as liquidity returns.
