Bitcoin and Ethereum investors are bracing for potential market volatility as a staggering $3.29 billion in options are set to expire today. This significant development could spark short-term fluctuations in prices and impact traders' profits.
Of this total, a substantial $2.88 billion is attributed to Bitcoin (BTC) options, with Ethereum (ETH) options accounting for $417 million.
According to insights from Deribit, a total of 35,176 Bitcoin options are reaching expiry today, slightly surpassing the previous week's number of 29,005 BTC contracts. The put-to-call ratio for these expiring options sits at 0.74, with a maximum pain point of $86,000.
In parallel, 220,301 Ethereum options are nearing expiry today, a slight decrease from last week's figure of 223,395. The put-to-call ratio for Ethereum options stands at 0.69, with a max pain point of $2,100, which could influence short-term price actions for ETH.
As the clock ticks towards the 8:00 UTC deadline for these options, Bitcoin and Ethereum prices are anticipated to gravitate towards their respective maximum pain levels. Currently, Bitcoin is trading at $81,992, while Ethereum is at $1,891. Analysts note that prices could see a rebound as smart investors drive them towards the max pain range.
Although the pressure on BTC and ETH prices might ease post the 08:00 UTC settlement by Deribit, the sheer magnitude of these expirations may still inject heightened volatility into the cryptocurrency markets.
In terms of market sentiment, analysts highlight a prevailing bearish outlook in the short term, despite positive US CPI data earlier in the week. Traders are closely monitoring support levels and considering potential price bottoms, with discussions around the $60,000 mark as a possible downside target for BTC.
Furthermore, geopolitical events, such as President Trump's tariffs and inflation, are identified as significant market influencers, along with peace and stability factors globally. The potential for market confidence arising from peace agreements could bode well for both stocks and cryptocurrencies.
In separate analyses, shifts in option flows in the crypto market are being closely observed, particularly in Bitcoin derivatives trading on Deribit. Market sentiment and trading strategies are adapting accordingly to navigate the evolving market conditions, including adjustments to volatility and strategic rotations by traders.