Jul 4, 2024
According to Beincrypto - Today, about $1.54 billion in Bitcoin (BTCUSD) and Ethereum (ETHUSD) options are set to expire, creating a buzz in the crypto market. This event is expected to lead to significant price swings, so traders and investors are keeping a close eye on the market.
Analysts are predicting that the market will calm down after these options expire.
For Bitcoin, the expiring options are worth $1.04 billion, with 18,339 contracts set to expire. These contracts have a put-to-call ratio of 0.71 and a maximum pain point of $62,000. In options trading, the maximum pain point is the price level where option holders incur the most financial loss. The put-to-call ratio indicates there are more purchase options (calls) than sales options (puts).
Ethereum has 162,782 contracts expiring, worth $501.12 million. These contracts have a put-to-call ratio of 0.37 and a maximum pain point of $3,350. According to analysts at Greeks.Live, recent market sell-offs have resulted in significant losses, with Bitcoin dropping to $57,000 and Ethereum to $3,100.
Additionally, data shows that Bitcoin's short-term implied volatility (IV) is up by 10%, and the Deribit Implied Volatility Index (DVOL) is up by 3%. Ethereum's parameters have increased slightly less than Bitcoin's. Skew values suggest a bearish market sentiment.
Bitcoin and Ethereum prices have fallen sharply this week. On July 4, Bitcoin dropped from $60,000 to as low as $56,964 today, and is currently trading at $57,037. Similarly, Ethereum fell from $3,304 to $3,060, and is now valued at $3,083, down by 3.4% in the last 24 hours.
“BTC Block put volume is clearly on the rise, the distribution of transactions is more complex, the July 12 58,000 Put is the largest one. Looking at Options Data, whales are not too worried about potential downside risk at the moment and are mainly in the process of adjusting their positions for last week’s quarterly delivery, especially for ETH, where whales are showing low volatility expectations,” the Greeks.Live analysts said.
Experts attribute the recent decline in BTC and ETH prices to increased sell-offs from long-term holders, including governments. BeInCrypto reported that on-chain data shows the German government's crypto wallet moved 3,000 BTC, worth about $174.3 million, to various destinations, including major crypto exchanges like Bitstamp, Kraken, and Coinbase.
While options expirations can cause temporary market disruptions, they usually lead to stabilization. Analysts' insights emphasize the historical trends that traders might consider when planning their strategies. Ultimately, traders should stay alert, using technical indicators and market sentiment to navigate the expected volatility effectively.