The cryptocurrency market witnessed nearly 4 billion USD Bitcoin (BTC) and Ethereum (ETH) of the expired option contract today.
Market followers pay special attention to this event because of the possibility of short -term trends through their contract volume and nominal value. Considering the Put-to-Call ratio and maximum pain can provide an insight for the expectation of the trader and market directions that may occur.
Bitcoin and Ethereum options contract expired today
The nominal value of the BTC options contract expired today is US $ 3.19 billion. According to data from deribits, these expired Bitcoin option contracts have a Put-to-Call ratio of 0.48. This ratio shows the prevailing of the option purchase contract (Calls) compared to the option contract (PUTS).
The data also revealed that the maximum pain for these expired option contracts is US $ 100,000. In cryptocurrency options, the maximum pain point is the price at which most expired contracts are not valid. Here, the property will cause the most financial losses for investors.
In addition, there are 173.83k Ethereum optional contracts are about to expire today. These options contracts have a nominal value of $ 574.8 million and the Put-to-Call ratio is 0.47. The maximum pain is 3,300 USD.
The current market price of Bitcoin and Ethereum are both higher than the maximum pain. BTC is trading at 103,388 USD, while ETH is at $ 3,305.
“The BTC sore points is higher, while the ETH traders are located close to important levels,” Deribit observe.
This shows that if the options contract expires at these prices, it will often show losses for the option Holder.
The results for optional traders may vary significantly depending on the specific execution price and the positions they hold. In order to accurately assess profits or decline upon expiry, traders must consider their entire option position along with the current market conditions.
The significance of the contracts is about to expire
These expired contracts take place in the context of President Donald Trump’s execution order to create digital asset reserves in the United States. If approved, this initiative may include cryptocurrency assets other than Bitcoin.
Not only is a digital asset warehouse, the President also sets a group of cryptocurrencies to develop a federal framework for digital asset management. The US Securities and Exchange Commission (SEC) has also abolished the SAB 121 policy, allowing banks to deposit cryptocurrencies.
These developments, along with the expiry of the BTC and ETH options contracts, are the basic factors towards the uptrend that can stimulate fluctuations. Analysts at Cryptoquant revealed an interesting investor view that the comprehensive evaluation is necessary before making a conclusion.
“Is this quiet before a storm coming? The market continued to decrease even after the SEC announced the establishment of the Crypto regulation task force. BTC has broken below USD 106k and is currently standing at the threshold of $ 102k, ”analysts write.
Moreover, the analysts observed the increase in the purchase of options contracts with an enforcement price of 95 thousand USD for January. This may indicate that traders are looking for. Protection against potential risks when Bitcoin becomes losing momentum.
Psychological change from stronger to more vigilant is thought to be due to market conditions.
However, analysts predict the cryptocurrency market will continue to fluctuate within the scope until there is more clarity of the impact of recent economic data, especially the weak consumer price index. , for the meeting of the Federal Open Market Committee (FOMC) is scheduled for next week. This meeting may affect Fed’s upcoming policy decisions.