It is quite important for the two leading cryptocurrencies today. Because more than 96 thousand Bitcoin options with a nominal value of $ 6.2 billion will expire. Also today is the expiration of 990 thousand Ethereum options with a face value of $ 3.1 billion. Meanwhile, BitMEX co-founder Arthur Hayes is giving a strong bullish signal.
Will the two cryptocurrencies recover after options expiration?
Today, approximately $6.3 billion worth of BTC options will expire. This points to potential downside price volatility that could cause Bitcoin to drop to the $61,000 level. After these options expire, traders expect a recovery in the Bitcoin and crypto market. Therefore, this will likely halt profit taking on downside hedges.
More than 96 thousand Bitcoin options with a nominal value of $6.2 billion will expire on Deribit. The put-call ratio is 0.68, indicating a recent increase in put options as the monthly maturity approaches. The maximum pain point is $61,000. This is below the current price. The market expects a pullback in price on the maturity day. Therefore, a large fluctuation in the market is possible.
Additionally, 990 thousand Ethereum options with a face value of $3.1 billion will expire. These options have a put-call ratio of 0.51. The maximum pain point for Ethereum is $3,100. Hence, it is below the current ETH price of $3,141. This indicates a slight pullback.
P.Market sentiment remains low
Deribit shows that the BTC Volatility Index (DVOL) is rising sharply as crypto options expiration approaches. This reveals that the realized volatility is increasing. Options specialist Greekslive said this week that low cryptocurrency market volume has pushed Bitcoin and Ethereum prices to trade close to support levels. This weakness in the market resulted in significant declines in implied volatility (IV) across all major maturities. Additionally, DVOL has dropped by as much as 15% since the halving. The lack of volatility in the market has led to a large number of options being sold.
Additionally, market sentiment remains low due to recent spot Bitcoin ETF outflows. According to experts, the chances of BTC returning to ATH levels are extremely low as it will face more resistance.
Arthur Hayes: Predicts Crypto Market Recovery
BitMEX co-founder Arthur Hayes shared his views on the markets following the latest developments. Hayes said it was an important bull signal for crypto and stock markets. Macro factors stand out as the primary reasons behind the recent decline in crypto market sentiment. So, Hayes noted that tax receipts from US citizens added $200 billion to the US Treasury Department’s Treasury General Account (TGA) and the next steps could bring a recovery in the markets. In this context, Hayes shared the following assessment:
Janet Yellen will trigger a rally in stocks and crypto markets if any of the following three options are considered:
- Stopping treasury bond issuance by reducing the NPL to zero, which would be a $1 trillion liquidity injection.
- It would shift more borrowing into Treasuries to get money out of the RRP, meaning a $400 billion liquidity injection.
- The combination of 1 and 2 would be a liquidity injection of $1.4 trillion. The Treasury can withhold long-term bonds and issue bonds while reducing the NPL and RRP.
Hayes expects the crypto bull market to accelerate again if any of these three options come true. Markets are also watching the Fed’s PCE inflation release today, its preferred gauge of inflation, for further guidance on the direction of prices over the next few weeks. cryptokoin.comAs you follow from , the annual PCE rate is expected to increase for the second month in a row, rising from 2.5% to 2.6%, while annual core PCE inflation is expected to rise from 2.8% to 2%, the lowest level in the last three years. It is expected to decrease to 6.
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