The cryptocurrency market is experiencing some volatility as the calendar moves into the last quarter of the year. The recent expiration of $1.35 billion worth of Bitcoin and Ethereum options has not created volatility in the market. It may lead to price increases as investors rebalance their portfolios ahead of the US elections.
Market Shifts Post-Options Expiry
Notably, the expiration of the options contracts for Bitcoin and Ethereum has been traditionally a significant driver of price swings in the crypto market. This October, the pattern remains the same as a total of options expiring amounts to $1.35 billion affects both assets.
For Bitcoin, the Put Call Ratio (PCR) is at 0.75, with a lot of trading interest around the $63,000 level. This means that investors are in a rather defensive mode. On the other hand, Ethereum has a healthier outlook than Bitcoin. Its PCR stands at 0.68, with the maximum pain point at $2,500 showing higher conviction among investors.
However, the past 24 hours have seen both cryptocurrencies maintain their stability as well as growth. The value of Bitcoin increased by 2.59% with the price standing at $62,267 in the last one day. In the same period, Ethereum price also rose and was trading at $2420, a 2.8% rise. At the moment it has a market capitalization of $291.42 billion.
These movements depict the repositioning of traders after the expiry of the contracts. It also depicts a positive sentiment for the fourth quarter. This is based on past trends. These major digital assets have been known to rise during the last month of the year.
Anticipation of U.S. Elections Stirring Market Sentiments
Furthermore, the US elections are another crucial event where the financial markets, including the cryptos, tend to experience volatility and speculative trading. The open interest behaviour for Bitcoin suggests that we are gearing up for more range-bound moves with focus on the approach expiries.
This could result in higher levels of trading and even price volatility especially in the days leading to the elections. Nonetheless, the Ethereum market looks somewhat different from the overall positive sentiment of the Bitcoin market.
Given that the majority of its options contracts are set to expire and that options contracts have more calls than puts, the sentiment on Ether is bullish. The notional value of such options and the heavy concentration of the open interest towards the year end expiry point to the fact that investors are bullish on ETH in the near future.
Will Bitcoin Rally in October After Strong Close Last Month?
In addition, the last positive close at the end of September also brought a positive conclusion for Bitcoin. It is not known for being a favorable month for Bitcoin. This month, often dubbed “Uptober” by enthusiasts, has sparked speculations about BTC potential to reach new heights.
Past performance also indicates a strong optimistic view for October, hence the high expectations by investors for large returns. According to some market specialists and analysts, Bitcoin has all the chances to rise above the $100K mark by the end of the year.
However, not all market analysts believe in this point of view. Some more experienced traders continue to be cautious and note that Bitcoin has to break through the resistance level in order to start a bullish trend. A recent analysis also reveals that the BTC price has a potential of falling to $60,000 due to the escalated tensions in the Middle East.
