Today, nearly $3 billion worth of Bitcoin (BTC) and Ethereum (ETH) options are set to expire. This could lead to notable price swings as traders brace for potential volatility.
$2.72 Billion in Options Set to Expire
According to Deribit, 20,815 Bitcoin contracts valued at $2.077 billion will expire today. The put-to-call ratio is at 0.83, meaning traders are favoring long positions.
The “maximum pain” point for Bitcoin is $98,000, slightly below its current market price of $99,758. This level represents the price at which the most options holders face losses.
Similarly, 164,330 Ethereum contracts worth $644 million will expire. For Ethereum, the put-to-call ratio stands at 0.68, suggesting a preference for long positions.
Will the Market See a Christmas Rally?
This week, the market saw corrections across the board. Bitcoin experienced mild pullbacks, while altcoins faced sharper declines. As the holiday season nears, market makers are repositioning their strategies.
Bitcoin currently trades below $100,000, while Ethereum is hovering near $4,000. Analysts speculate whether this could lead to a year-end rally or continued market divergence.
Increased Caution Among Traders
Recent options market data shows that implied volatility (IV) has risen slightly amid sharp market fluctuations. Analysts from Greeks.live suggest that short-term trading strategies might benefit from the current environment.
Economic Factors Adding Complexity
This expiration coincides with a week of critical U.S. economic updates. Inflation rose to 2.7% in November, with the core CPI steady at 0.3%. While a Federal Reserve rate cut is expected, persistent inflation challenges sustained monetary easing.
