A big chunk of Bitcoin options, which are due to expire today, may have a major effect on the market which is currently on the path towards an upward trend.
The crypto market is bracing for a significant event today. 23,000 Bitcoin options, with a notional value of $1.4 billion, are set to expire. This event could significantly impact the price of Bitcoin, especially since it’s been hovering at lower levels in recent days. The options, which are due to expire today, have a put-call ratio of 0.49 and a max pain point of $61,000.
The put-call ratio, which measures the number of put options compared to call options, indicates a relatively balanced market sentiment, with neither side significantly dominating the other. This could suggest that the market is anticipating a relatively stable price movement for Bitcoin rather than a dramatic swing in either direction.
The current market sentiment is neutral, with some analysts predicting a dull summer for the derivatives market. The decline in implied volatility since mid-April may have led them to predict so. Implied volatility measures the market’s expectations of future price movements. It is also one of the key factors in determining the prices of options.
The drop in implied volatility could indicate that the market is relatively certain about future price movements.
BTC 1D price chart
The price of Bitcoin has been recovering steadily over the past few days, moving closer to $60,000. It is currently trading at $59,500, as of May 3. However, to maintain the bullish trend, it needs to hold above $59.5K. Bitcoin’s price rose by 3% in the last 24 hours, standing at $59,366 by noon. But the trading volume dropped 39.24% in the same period.
Also, Bitcoin’s market cap was trading at around $1.17 trillion in the last 24 hours. The market is closely watching the expiration of these options to gauge the future direction of the price movement.
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