After facing strong resistance at $61,300 levels this week, the Bitcoin price tanked all the way under $57,000 on Thursday before recovering partially. All eyes will be on Friday’s Bitcoin options expiry which suggests a tight fight between the bulls and bears currently.
Bitcoin Options Expiry and Easing Market Volatility
On Friday, August 16, a total of 24,000 Bitcoin options are set to expire with a put call ratio of 0.83 a notional value of 41.4 billion, and a max pain point of $59,500. This put-call ratio which is close to 1 shows that the bulls and bears are having a tough fight among themselves. As of press time, the Bitcoin price is trading 5% down at $58,077 with technical indicators hinting at a BTC price drop to $54,000.
The current options expiry represents only 10% of the total open positions currently in the market, with upcoming August, September, and December positions accounting for just over 20% each. Thus, the options term distribution remains relatively balanced and has strong resilience. The options market hints at easing crypto market volatility in the future which shows that the market could be entering a more stable phase.
Along with Bitcoin options, a total of 184,000 Ethereum (ETH) options are expiring today with a put-call ratio of 0.80, a notional value of $470 million, and a max pain point of $2,650. The Ethereum price is also facing some selling pressure down 3.47% at press time and trading at $2,587.96 with a market cap of $311 billion.
Macro Tailwinds Block the Bitcoin Rally
Despite the cooling CPI inflation data, Bitcoin bulls have failed to regain strength during the current market volatility facing strong rejections at $61,300 levels. 10x Research noted that the macro tailwinds have been preventing the Bitcoin rally to $66,000 with traders staying confused amid the strong disconnect between US tech stocks and the underperformance of the crypto market.
As per the report from 10x Research, Bitcoin could retreat into the trading zone between $50,000 and $60,000. On the upside, BTC is facing strong resistance in the range between $60,000-$61,000. This potential slowdown might also give oversold technical indicators a chance to reset, raising the likelihood of Bitcoin retesting its August 5 low near $50,000—a move that could catch many investors by surprise.
Bhushan Akolkar
Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
The spectacular crypto comeback has stalled following a series of weak corporate earnings from the United Stats. Ethereum pulled back to $1,500 on Thursday as data showed that the put/call ratio was heading higher. It has fallen by over 5.90% from the highest point this year.
Put and call ratio slips
The options market is an important one across all asset classes, including cryptocurrencies, stocks, and commodities. It involves placing put-and-call trades on an asset. A call gives the trader the right to buy an asset while a put gives them the right to sell.
The put to call ratio is an essential tool that traders and investors use to predict whether an asset will rise or not. That is why it is an important part of the fear and greed index.
Data compiled by The Block shows that Ethereum’s put/call ratio has edged upward slightly in the past few days. It has risen from 0.24 on January 4 to a high of 0.3. Historically, a lower ratio is usually preferred since it means that there are more buyers in the options market. Still, it should be noted that The Block’s data comes only from Deribit and does not include other exchanges.
Meanwhile, another data by CoinGlass shows that the number of short liquidations in key exchanges rose to the highest point in months on January 15. Liquidations have continued but at a slower pace since then. However, at the same time, long liquidations have been rising. On Wednesday, they rose to the highest level since December 16 of last year.
The main reasons for these liquidations is the weak financial results by companies like Goldman Sachs and JP Morgan. Some of these firms have warned about a recession and announced significant job cuts. Microsoft is laying off over 10,000 people.
Ethereum price forecast
Ethereum has stumbled as put and call ratio and long liquidations rise. This stumbling happened as the coin reached a high of $1,612, the highest point since November. It has moved slightly below the descending trendline shown in purple.
At the same time, it has struggled moving above the key point at $1,667, the highest point on November 4. Therefore, I still believe that the outlook for Ethereum is still bullish, with the next key point to watch being at $2,000 as I wrote in this article.
How to buy Ethereum
eToro
eToro offers a wide range of cryptos, such as Bitcoin, XRP and others, alongside crypto/fiat and crypto/crypto pairs. eToro users can connect with, learn from, and copy or get copied by other users.
Binance
Binance is one of the largest cryptocurrency exchanges in the world. It is better suited to more experienced investors and it offers a large number of cryptocurrencies to choose from, at over 600.
Binance is also known for having low trading fees and a multiple of trading options that its users can benefit from, such as; peer-to-peer trading, margin trading and spot trading.
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