This Friday, March 14, the cryptocurrency market is poised for a significant event, with approximately 35,000 Bitcoin options contracts set to expire, totaling a notional value of around $2.9 billion. This week’s expiry slightly surpasses last week’s figures, indicating a growing momentum in derivatives trading. However, the spotlight is set on the mammoth $11 billion options contract expiry scheduled for March 28, which could lead to further market ramifications.
The immediate impact of this week’s options expiry on spot markets is anticipated to be minimal, as traders digest recent U.S. inflation data that came in slightly lower than expected. This could mitigate sharp movements in the price of Bitcoin as the market stabilizes.
Bitcoin Options Expiry Insights
This week’s batch of Bitcoin options exhibits a put/call ratio of 0.73. This ratio suggests that a greater number of call (long) contracts are set to expire compared to put (short) contracts. Furthermore, open interest (OI) for options contracts indicates that there remains significant activity, particularly at the $120,000 strike price with an OI value of about $1.4 billion according to data from Deribit. Meanwhile, the $100,000 and $120,000 strike prices also show considerable OI, reflecting some confidence in bullish price movements.
Yet, traders are also facing bearish tendencies, with nearly $850 million placed in bets predicting Bitcoin might fall to $70,000. Analysts from Greeks Live have noted a lingering bearish sentiment despite some positive consumer price index (CPI) reports, suggesting a cautious outlook as the crypto community monitors support levels. Some experts speculate that a potential downside target could be around $60,000.
“Skepticism prevails in the market,” analysts noted, as traders quickly dismissed positive CPI figures amidst prevailing bearish sentiment.
In conjunction with Bitcoin options, around 220,000 Ethereum contracts valued at approximately $416 million are also set to expire, with a put/call ratio of 0.68. This brings the total notional value of options expiring today in the crypto market to roughly $3.3 billion.
Current Crypto Market Outlook
The broader cryptocurrency market is experiencing a downturn, with a total capitalization decline of 3.7%, now resting at $2.76 trillion. Bitcoin’s price fell to $80,000 before a slight recovery brought it to approximately $82,000. However, the trend appears weak, with predictions suggesting further declines to about $70,000.
Ethereum remains stagnant in bear market territory, struggling to surpass $1,900 after dipping to around $1,830. Meanwhile, altcoins are showcasing a mixed performance, with Cardano (ADA), Pi Network (PI), and Hedera (HBAR) facing more substantial losses, while XRP, Binance Coin (BNB), Tron (TRX), and Stellar (XLM) saw minor gains.
As the cryptocurrency market navigates these turbulent waters of options expiry and fluctuating prices, traders will continue to watch for signs of recovery or further decline in this dynamic and ever-evolving landscape.
