The cryptocurrency market is preparing for an important event as a large number of options will expire tomorrow.
On October 6, a total of 14,000 Bitcoin (BTC) options and 200,000 Ethereum (ETH) options will expire. The dollar equivalent of the total BTC amount whose option will expire was recorded as approximately 383 million dollars, and the dollar equivalent of the total Ethereum amount was recorded as 322 million dollars.
While the Put/Call Ratio of BTC options is 0.89, the maximum loss point is $27,000 and the face value is $400 million. On the other hand, ETH options have a Put/Call Ratio of 0.87, a maximum loss point of $1,650, and a notional value of $330 million.
Maximum Loss Point refers to the strike price at which the most open option contracts (i.e. put and call options) will expire worthless and cause maximum financial loss for the largest number of option holders at the end of maturity.
BTC is the driving force behind the market's uptrend this week. However, despite this positive move, major implied volatilities (IVs) remained low. This is largely due to the holiday factor leading to lower trading volumes during Asian trading hours.
Historically, the fourth quarter, especially October, has been a season of upward trends in the cryptocurrency market. Market participants hope that this year will be the same and be as active as previous years.
Interestingly, the share of put positions remains high. With liquidity continuing to deteriorate recently, there are signs that significant market movements may be on the horizon this month, according to analysts.
*This is not investment advice.