Around $1.54 billion worth of Bitcoin (BTC) and Ethereum (ETH) options expire today, creating significant anticipation in the cryptocurrency market.
Crypto options expirations often result in significant price volatility, prompting traders and investors to closely monitor current events.
Analysts predict stabilization after options expiration in the crypto market
Expiring Bitcoin options have a notional value of $1.04 billion, with 18,339 contracts expiring. These contracts have a put-to-call ratio of 0.71 and a maximum pain point of $62,000.
Read more: Introduction to Crypto Options Trading
The maximum pain point in options trading is the price level that causes maximum financial pain to option holders. Additionally, the put-call ratio implies that call options outnumber put options.
Ethereum has 162,782 expiring contracts with a notional value of $501.12 million. These contracts show a put-call ratio of 0.37 and a maximum pain point of $3,350. Analysts at Greeks.Live noted that the recent market sell-off has led to large losses in the crypto markets, with BTC falling to $57,000 and ETH to $3,100.
Additionally, the data shows that BTC’s short-term implied volatility (IV) has risen by 10%. Meanwhile, the Deribit Implied Volatility Index (DVOL) has risen by 3%, with ETH-related parameters rising slightly less than BTC. The skew values indicate bearish market sentiment.
“BTC Block put volume is clearly increasing, the transaction distribution is more complex, the July 12 put at 58,000 is the largest. Judging by the options data, whales are not too concerned about the potential downside risk at the moment and are mostly adjusting their positions for the quarterly delivery last week, especially in ETH, where whales show low volatility expectations,” Greeks.Live analysts say.
Bitcoin and Ethereum prices have fallen significantly this week. BTC fell from $60,000 on July 4 to $56,964 today. At the time of writing, Bitcoin is trading at $57,037. Similarly, Ethereum has fallen from $3,304 to $3,060 over the same period. ETH is currently valued at $3,083, down 3.4% in the last 24 hours.
Industry experts attribute the recent decline in BTC and ETH prices to increased selling by long-term whales, including governments. BeInCrypto reported that on-chain data shows that a German government crypto wallet transferred 3,000 BTC worth about $174.3 million to several destinations yesterday. These include major crypto exchanges like Bitstamp, Kraken, and Coinbase.
Read more: 9 Best Platforms for Trading Crypto Options
While options expiration can cause temporary disruptions in the market, it usually leads to stabilization. Recent findings from analysts highlight historical patterns that traders can consider when strategizing their positions. Ultimately, traders must remain vigilant, analyzing technical indicators and market sentiment to effectively navigate expected volatility.
