Traders often try to predict the price of a crypto asset using ‘derivatives market’ data. Ethereum The derivatives market is also used by many traders for a similar purpose.
Current data from the Ethereum derivatives market suggested an ambitious $3,000 estimate for ETH. In addition to this development, the interesting movement of funds in the options market also caught the eye.
After Ethereum’s recent ‘explosive’ growth, investors are ‘to the $3,000 level’open contracts‘ began to open. While the expiry date of open contracts remained the same as in the November-December period, it was noteworthy that the target increased. As a result, these data reveal the changing sentiment of investors.
However, it is too early to comment that traders and investors are betting on such a high price as a positive development. Such a large position can be opened from time to time to maintain the ‘spot position’.
Some speculative traders also prefer to use these options. Fund managers and institutional investors tend to use them as a hedging tool. Traders who use options as their main trading tool usually derive their profits from the price of the contract.
Even if the price of Ethereum does not reach $3,000 in the short term, traders who open this contract can profit from a sharp price increase. Technically, holding an options contract can be considered exposure to an underlying asset.
Koinfinans.com As we reported earlier, a strong increase in volume can be part of a major hedging strategy. because Ethereum derivatives marketsHedging these positions with options would make sense for a high-positioned trader, as the short volume on the stock remains high.
You can follow the current price action here.
Disclaimer: What is written here is not investment advice. Cryptocurrency investments are high-risk investments. Every investment decision is under the individual’s own responsibility. Finally, Koinfinans and the author of this content cannot be held responsible for personal investment decisions.