$2.7 Billion in Bitcoin and Ether Options Set to Expire on May 24, Bullish Sentiment Prevails
Summary:
On May 24, around $2.7 billion worth of Bitcoin and Ether options are expected to expire with Bitcoin's maximum pain point at $67,000, bringing potential losses to option investors. The open interest in Bitcoin options significantly leans towards call options. Ethereum contracts also show a substantial expiry, leaning mildly bullish. The high levels of open interest in both cryptocurrencies indicate traders' confidence in rising prices. A larger expiry of options worth $4.3 billion looms on May 31.
Around $2.7 billion of Bitcoin and Ether options is due to expire on May 24, shedding light on the trend of sentiments in the cryptocurrency market. As per information from Greeks.live on X, roughly 21,000 Bitcoin (BTC) options are inching towards their end with a put/call ratio of 0.88. This highlights an almost equally matched dispersion between sellers and purchasers, skewed slightly more towards call options. Furthermore, most option investors would face losses if the prices hit the maximum discomfort point at $67,000, which corresponds to a nominal cap of $1.4 billion. Although the imminent expiry of the 21,000 contracts is significant, it is dwarfed by the much larger upcoming event on May 31, with options worth a massive $4.3 billion set to expire, as disclosed by Deribit. Deribit's analysis mentions that long stance leads the open interest (OI) predominantly, with a hefty $830 million associated with the $70,000 strike price. In addition, higher strike prices also have a substantial OI, with a significant $843 million at the $100,000 mark, towards a bullish drift among traders. For put contracts, a $60,000 strike price, with $388 million in open interest, is the most prominent one. This considerable OI highlights several set to be settled contracts remaining, proving that Bitcoin bulls foresee far-reaching higher prices for the currency. The options expiry scenario is not exclusive to Bitcoin. The expiry also involves approximately 350,000 Ether (ETH) contracts, accounting for a notional value of $1.3 billion. With 0.58 put/call ratio and a max discomfort point at $3,200, more call options are leaning toward expiration rather than put options, signaling a mildly bullish trend. According to Greeks.live’s findings, Ethereum recently overtook the crypto rally led by ETF advancements, demonstrating a substantial single-day surge of 20 percent. The options' short-term implied volatility (IV) spiked to 150% at one stage, considerably surpassing Bitcoin's existing IV for the same time scale. However, a separation between Bitcoin and Ethereum is now discernible as Ethereum's bullish sentiment continues to be robust. In terms of overall market trading and structure, maintaining elevated IV levels for each significant term is proving to be challenging. Calendar spreads, in this case, might be a preferable option. Contrarily, Bitcoin is more evenly distributed amid long and short positions, with more potent selling call forces.
Published At
5/24/2024 12:25:09 PM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.