Analysis: Market Maker 'BTFD' Below $10.6K to Hedge, Providing Organic Support

BlockBeats News, October 11th, On-chain data analyst Murphy stated that from the current BTC options market structure, the upper side is dominated by Call buyers, while the lower side is dominated by Put sellers, forming a typical "long gamma on the downside, short gamma on the upside" structure. The specific price ranges and net premium size are as shown in the chart.

When the price is in a high concentration area of Call buyers (from $113,000 to $125,000), market makers are in a short Gamma zone. As the price rises, they need to passively buy spot to hedge, creating a boosting effect on the price; conversely, when the price falls, they need to passively sell, driving the price lower. This range is a "volatility amplification zone." When the price enters this volatility zone, market makers' hedging needs are most sensitive, so price changes will trigger stronger passive buying and selling feedback.

When the price drops below $106,000, market makers are in a long Gamma zone, meaning that as the price falls, market makers will buy spot to hedge, providing support in the lower range, known as the "Gamma support zone." When the price falls into the long Gamma range, market makers' hedging behavior will shift to "buying the dip," thus providing natural support to absorb downward fluctuations and stabilize the price. This analysis is for educational purposes only and not investment advice.