Some traders are predicting a significant rally following the recent approval of a spot Ethereum ETF in the United States.
The options, which are worth approximately $3.4 billion and expire on June 28, indicate an increase in the number of traders purchasing call options. These bullish predictions predict that Ethereum will surpass $4,000.
According to TzTok-Chad, anonymous founder of decentralized options exchange Stryke, positioning in derivatives shows that many traders are setting their sights even higher and targeting prices above $5,000.
This unexpected reversal from the SEC shifted the focus from Bitcoin to Ethereum among options traders. “While Bitcoin has received relatively low traction, the spotlight is on Ethereum,” says Luuk Strijers, CEO of options exchange Deribit.
However, if Ethereum rises to $5,000, it may not be a smooth ride. TzTok-Chad warns that “traders should expect some volatility through May 31, given that large traders will take significant profits.”
Interestingly, the May 31 options expiration position shows that traders are less bullish and points to a more cautious approach as the month end approaches.
*This is not investment advice.
