How options expiration will affect BTC and ETH
The notional value of the 69,179 BTC and 908,754 ETH contracts expiring soon is $4.7 billion and $3.4 billion, respectively. Let's see if the expiry can provoke increased volatility in the market and affect the price of the two largest cryptocurrencies by capitalization.
Options traders overestimated the strength of the bulls
According to Deribit, the put/call options ratio on BTC is holding steady at 0.61. This means that traders are still maintaining a bullish bias, and the number of calls, or long contracts, outnumber puts, or short contracts. The maximum pain point - that is, the price at which the asset will cause financial losses to the largest number of holders - is at $66 thousand.
However, given the bulls' inability to break above the $70,000 resistance, traders' optimism may be overdone. 91% of contracts were placed at or above $72,000, which means that holders were counting on a sustained rally.
What will happen to the BTC price amid the expiration
Bitcoin's price briefly rose above $70,000 this week amid renewed inflows into spot ETFs. However, the asset was unable to hold its ground and open the way for a new rally. At the time of writing, BTC is trading at $68,300, having added 0.6% over the past 24 hours.
Ethereum's dynamics are also unexpressive: despite the long-awaited approval of eight spot ETFs on ETH, the second most capitalized cryptocurrency still can't get back to $4,000.
Predicting how the market will behave on the day of expiration of a large number of contracts is quite difficult - especially if any events affecting the news background are added to it. Nevertheless, traders should keep a close eye on the situation so that the increased volatility does not lead to unwanted triggering of stop loss orders or making wrong trading decisions.#BTC☀ #btc70k #ETH🔥🔥🔥🔥 $BTC $ETH