Bitcoin Options worth $1.943B expire today, with BTC price rallying to $61,000 after a 20% 4-day increase.
ETH options worth $560M expire, with ETH recovering 10.7% to $2,700 amid a balanced put-call ratio of 0.96.
ETH faces technical challenges with a 'death cross' on its chart, yet analysts suggest a potential rise to $2,820.
The overall cryptocurrency market has been quite volatile this week, with soon-to-expire $2.5 billion worth of Bitcoin and Ether options in play. Bull and bear sentiments have been fighting a tough battle during this period, yet Bitcoin and Ethereum have remained resilient, allowing both to reach high levels before the options' expiration.
https://twitter.com/GreeksLive/status/1821762948806889719 Bitcoin Options Expiry and Market Recovery
As of Deribits, 32,000 Bitcoin options contracts will expire today with a put/call ratio of 0.71. The notional value of expiring options is $1.943 billion, while the maximum pain point, where most options contracts will be worthless, is $60,000.
The catalyst for the most recent price swing was a rate hike from the Bank of Japan, which initially sent Bitcoin prices below $50,000. In reaction to potential market turmoil, an about-face on this stance has spurred a strong recovery.Bitcoin's 20% rise in the last four days to $61,000 has reassured market participants. However, implied volatility remains high relative to pre-crash levels, indicating that uncertainty has not been erased.
According to the Grayscale Research analysis, assuming the US economy does not enter a recession, Bitcoin will challenge its all-time highs before the end of the year. The same study also states that the Federal Reserve may decrease interest rates if economic conditions deteriorate further, stimulating the cryptocurrency market.
Ethereum Options Expiry Amid Bullish Rebound
Ethereum also witnessed a large number of options expiring today. The put-call ratio is nearly at parity, at 0.96, with the week recording 206,000 ETH options contracts, indicating a near-even mix of bullish and bearish positions. The notional value of these contracts stands at $560 million, with a max pain point of $2,950, where most contracts are set to expire worthless.
Ethereum has recovered in the previous 24 hours, rising 10.70% to within the range of $2,700. The performance of the most recent Ethereum ETFs, for example, was steady during the market slump but has since had withdrawals as prices began to rise, indicating a change in investor opinion.
Despite recent increases, Ethereum still needs to catch up with Bitcoin. The ETH/BTC trading pair has been spotted dropping and is currently hovering around 0.0437, showing that Ethereum lags behind Bitcoin. Indeed, what first stirred up the sentiment was the approval of spot Ether ETFs in the U.S., but it quickly fizzled into a "sell the news" reaction, with notably large outflows from Grayscale's ETHE product.
Ongoing Challenges for Ethereum
Ethereum has been recovering from the key support of $2,116 in recent price action. Currently, the cryptocurrency is trading at $2,670, but this still signals that Ethereum is in a bearish phase, clearly evidenced by a death cross between the 50 and 200 moving averages on its daily chart, which formed in November 2023. This technical indicator usually leads to a prolonged bearish trend, posing serious challenges to Ethereum's short-term outlook.
Crypto analysts have mixed views about what will happen next with Ethereum. Some are cautious because of the bearish trend, while others, like Ali Martinez, are confident that a short-term break could lead to around $2,820. He mentions a bullish pennant pattern forming on the Ethereum one-hour chart, which might push prices further.
The post Bitcoin and Ethereum Recover as $2.5B in Options Set to Expire appeared first on Crypto News Land.
