Bitcoin Options Expiry Insights: As the crypto world awaits the significant Bitcoin options expiry this Friday, there is speculation about its impact on the current market trend. The total open interest, including Ethereum options, is at a staggering $730 million, leading to a state of uncertainty in the crypto markets.
Today, approximately 14,000 Bitcoin options contracts, with a notional value close to $400 million, are expiring. While this event is substantial, it is not as significant as last week’s expiry, which marked the end of the month and quarter.
The term “max pain” in the crypto sphere refers to the price level with the highest number of open contracts. For today’s Bitcoin options, this level is at $27,000, which is around $500 below Bitcoin’s current spot price. This level also indicates where the most significant losses might occur upon contract expiration. Today’s options have a put/call ratio of 0.89, showing that the sellers of both longs and shorts are nearly in balance.
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The market analytics platform, Greeks Live, has highlighted that while Bitcoin has led this week’s upward trend, the overall implied volatility remains relatively low. They have also observed reduced trading volume in Asian markets, likely due to holiday factors.
Historically, October and the concluding quarter have seen uptrends. However, Greeks Live warns that with the high number of put positions and the recent liquidity dip, significant market movements may be on the horizon this month.
Ethereum Options Expiry Overview: In addition to Bitcoin, approximately 200,000 Ethereum options contracts with a notional value of $330 million are set to expire on October 6. This brings the combined total for both Bitcoin and Ethereum options to an impressive $730 million.
The Ethereum contracts have a put/call ratio of 0.87, reflecting a similar ratio observed in BTC derivatives.
However, market experts believe that this week’s options expiry may not have a significant impact on the spot markets, which have been declining. After briefly surging to $28,500 on Monday, Bitcoin has experienced a 3.5% drop and is currently trading at $27,485. Without any new stimuli, it is possible that Bitcoin may gravitate towards the $27,000 support level.
On the other hand, Ethereum, after its Monday surge, has seen a 6.6% drop and is trading at $1,620 during Friday’s Asian trading hours. The support for Ethereum currently remains just below the $1,600 mark.