This letter is a follow-up to the one published at the end of June this year, titled Options 101. We recommend reading that letter first if you’re not yet familiar with trading options, or at least keeping it nearby so you can switch between the two and use it as a reference. Before we begin, note that this letter is not financial advice and should not be taken as a solicitation to engage in any trades. It’s for educational purposes only and aims to explain how to think about the options market. Using real-world examples helps make the material more relatable than using abstract, fictitious ones. We want TBL Pros to be able to connect with these ideas and frameworks.
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For our thesis, let’s assume this price action and the associated behavior continue. In the letter called Cycle Analysis, we looked at the price action of gold after the first gold spot ETFs were approved. Gold essentially moved steadily upward for more than seven years with only minor drawdowns. Bitcoin could follow a similar path — a slow and steady price climb of around 20% to 40% per year over the next few years. This isn’t a prediction; it’s a base case. The base case would be invalidated if the price were to move significantly outside the first deviation bands, either up or down. To put that in current valuations: if the price drops below $93,600, the thesis would be invalidated, as it could signal the start of a bear market. If the price exceeds $149,000 within a short period, it could indicate another parabolic move upward, which would raise the probability of a sharp correction afterward. Time to enter...Subscribe to The Bitcoin Layer to unlock the rest.Become a paying subscriber of The Bitcoin Layer to get access to this post and other subscriber-only content. A subscription gets you:
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Monday, October 6, 2025
Theta Capital
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