Today, the cryptocurrency market is on edge as it anticipates the expiry of Bitcoin and Ethereum options contracts worth approximately $1.85 billion. The expiry is expected to bring heightened volatility, with market participants keeping a close watch. Deribit reports that 23,832 Bitcoin contracts, valued at around $1.37 billion, are set to expire, a significant increase from last week’s 18,339 contracts.
What Is Happening in the Options Market?
The expiring Bitcoin contracts have a put-to-call ratio of 1.09, with the maximum stress point at $58,500. This figure shows that the buying options outnumber the selling ones, indicating a bullish sentiment. The maximum stress point signifies the price level causing maximum financial strain for option holders.
Moreover, 156,792 Ethereum contracts, amounting to over $488.05 million, are also due to expire today. The put-to-call ratio for Ethereum stands at 0.38, with the highest stress point recorded at $3,100.
Which Economic Factors Are Influencing the Market?
Earlier this week, the broader economic landscape impacted the crypto market. On July 11, the Bureau of Labor Statistics (BLS) released the US Consumer Price Index (CPI) data for June, revealing an annual inflation rate of 3%, which was below market forecasts.
Key Insights for Investors
– Bitcoin reached $59,000 briefly amid economic updates.
– Ethereum traded around $3,105 despite market pressures.
– Significant Bitcoin sales by the German and US governments affected market sentiment.
– Analyst Adam from Greeks.live emphasized the importance of Implied Volatility (IV) levels.
– Investors should consider higher IV for potential sell orders.
Despite the anticipated volatility from the options expiry, historical patterns suggest that sharp price movements are usually short-lived, and markets tend to stabilize quickly. Still, investors must remain vigilant and analyze technical indicators and market sentiment to navigate this turbulent period effectively.