Bitcoin
$2.2B Crypto Options Expire as Macroeconomic Data Looms
The crypto market is bracing for potential temporary turmoil, with more than $2.2 billion worth of Bitcoin (BTC) and Ethereum (ETH) options set to expire today.
Expiration may cause greater volatility on the market, and will this affect the price of the two main cryptocurrencies?
Examining the imminent expiration of options for Bitcoin and Ethereum
Approximately $1.24 billion worth of Bitcoin options contracts and $984 million worth of Ethereum options contracts are about to expire. Depending on how traders react to the event, the expiration of these options contracts could trigger a new wave of sales or buying pressure.
According to data from Deribit, 17,609 Bitcoin contracts are about to expire, with a put-to-call ratio of 0.67. This ratio suggests a prevalence of call options over put options.
See more information: An Introduction to Crypto Options Trading
Bitcoin options expiring. Source: Debt
Meanwhile, Bitcoin’s maximum pain point is around $70,000. The maximum problematic point is the price level at which the asset will cause financial losses to the greatest number of holders.
Analysts at crypto options trading tool provider Greeks.Live suggested a positive outlook for Bitcoin and Ethereum prices despite the upcoming options expiration. They explained that the crypto market, especially Bitcoin, showed signs of strength following the announcement of interest rate cuts by the Bank of Canada (BOC) and the European Central Bank (ECB).
“Nonfarm payrolls and the US unemployment rate have also become more interesting, with Fed Rate Lowered Expectations now at the center of macro trading. Short term [implied volatility] The IV is now clearly increasing, with the weekly index [at-the-money] ATM IV returned above 50% but still below 50% at the end of the week at a time when traders are betting [today’s] data to beat expectations, with slightly stronger bullish forces,” they observed.
In the Ethereum market, 259,641 contracts are about to expire. The put-to-call ratio is 0.64. Ethereum’s maximum pain point is $3,650.
See more information: 9 Best Crypto Options Trading Platforms
Although option expiries can cause temporary market disruptions, they are often followed by stabilization. Traders must remain vigilant by analyzing technical indicators and market sentiment effectively navigate predicted volatility.
At the end of the week, Bitcoin and Ethereum showed resilience. Bitcoin hit a two-month high of $71,713 before pulling back slightly. On the other hand, Ethereum is trading at $3,805, having suffered a small drop.
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