Bitcoin and Ethereum investors are bracing for significant market moves today as more than $2.2 billion worth of crypto options are set to expire on Deribit, coinciding with major macroeconomic events. Both flagship cryptocurrencies are trading near their respective ‘max pain’ levels, signaling market tightness and hedging activity.
Bitcoin and Ethereum at Max Pain Levels
At the time of writing, Bitcoin is trading around $90,985, effectively aligning with its max pain level of $90,000. Similarly, Ethereum is trading near $3,113, just above its $3,100 max pain mark. Together, Bitcoin and Ethereum account for nearly $1.89 billion and $396 million worth of options contracts, respectively.
Bitcoin’s options market shows a put-to-call ratio of 1.05 with 10,633 puts and 10,105 calls, resulting in a balanced outlook. Meanwhile, Ethereum options present a more bullish sentiment, with a lower put-to-call ratio of 0.87, indicating heavier upside exposure. Analysts at Deribit stated that if Ethereum remains above its max pain level post-expiry, it could trigger upward price continuation due to dealer positioning.
Macro Pressures Add Complexity
Adding to the tension is today’s release of the US December employment report. Economists expect nonfarm payrolls to rise by 73,000 with an unemployment rate of 4.5%. Sticky wage growth could complicate the Federal Reserve’s inflation strategy, potentially impacting Bitcoin and gold as non-yielding assets face renewed pressure from strengthening US dollar indexes (DXY).
Additionally, the Supreme Court is slated to rule on tariffs imposed under emergency presidential powers, a legal decision that could further sway trade markets. Previous tariff headlines have revealed crypto’s sensitivity to broader macro dynamics, with Bitcoin historically dropping after tariff-related developments.
Market Volatility Ahead
Market watchers expect volatility to compress ahead of option settlements but foresee directional clarity emerging once dealer hedging fades. Kyle Doops, a leading analyst, commented, “Options expiry typically dampens volatility, but directionality could spike after resolutions from labor data and other macroeconomic drivers.”
Whether you’re a seasoned investor or new to crypto, staying informed is key to navigating such complex environments. For those looking to capitalize on market movements, timing and diversification are critical.
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As the crypto market grapples with these upcoming events, traders and enthusiasts alike are advised to watch the news closely, stay diversified, and maintain realistic expectations about short-term price movements.
