US PCE inflation and FOMC minutes expected to impact crypto market sentiment this week.
Over $10 billion in crypto options expiry could spark market volatility amid recent rally.
Upcoming Q3 GDP revision adds to a pivotal week for financial and crypto markets.
The financial and crypto markets are gearing up for a pivotal week as major economic data, including the US Personal Consumption Expenditures (PCE) inflation figures, the Federal Open Market Committee (FOMC) minutes, and a massive crypto options expiry, are anticipated to drive significant volatility.
The release of key economic indicators will begin with consumer confidence data and the FOMC minutes on Tuesday, November 26. These events are expected to provide insights into the Federal Reserve's monetary policy stance, particularly after the recent indication that the Fed might de-emphasize its 2% inflation target.
Market watchers will be analyzing these developments closely to gauge potential shifts in policy.
Midweek, attention will turn to the US Gross Domestic Product (GDP) figures for the third quarter. Scheduled for release on Wednesday, November 27, the first revision of this economic data will offer updated insights into the health of the US economy.
This information will be critical in shaping sentiment across both traditional financial and cryptocurrency markets.
Adding to the mix, the PCE inflation data for October will also be published on Wednesday. The monthly PCE rate is projected to remain steady at 0.2%, while the year-on-year figure is expected to rise to 2.3% from the previous month's 2.1%.
Core PCE inflation, which excludes volatile energy and food prices, is forecast to increase by 2.8% on an annual basis, reflecting persistent inflationary pressures.
Meanwhile, the crypto market faces heightened uncertainty due to the upcoming expiration of over $10 billion worth of Bitcoin and Ethereum options on November 29.
Data from Deribit indicates that Bitcoin options worth $9.13 billion and Ethereum options worth $1.24 billion are set to expire, with put/call ratios of 0.80 and 0.77, respectively.
The max pain price for Bitcoin is $77,000, while for Ethereum, it is $2,800. This large-scale expiry is expected to amplify volatility, potentially disrupting the ongoing market rally.Bitcoin and other cryptocurrencies have witnessed significant gains in recent days, buoyed by optimism surrounding Donald Trump’s election win and broader economic factors.
However, analysts caution that the expiry could prompt a selloff, even as long-term prospects remain favorable.
