arbaloch99.tk@gmail.com
Reasons to trust
Strict editing policy focusing on accuracy, relevance and fairness
Created by industry experts and meticulously reviewed
The highest standard for reporting and publishing
Strict editing policy focusing on accuracy, relevance and fairness
Morbi Pretium leo et nisl aliquam Mollis. Quisque Arcu Lorem, Ultricies Quis Pellentesque Nec, ullamcorper eu odio.
Español.
As the broader crypto market is taking a break following recent rallying beyond its $3 trillion market capitalization, traders are seeking leverage through options agreements between Bitcoin and Ethereum.
This surge in derivatives activity combines both BTC and ETH prices as both BTC and ETH prices are integrated over a narrow trading range and holds between $94,000 and $95,000 over the same period.
Related readings
The harsh price action is reflected in a reduced level of implicit volatility (IV); Bitcoin’s seven-day IV fell from 53% to mid-38%, while 30-day IV fell from 50% to 43%.
Ethereum’s volatility metrics reflect trends, with IVs retreating from 74% to 61% and 69% to 63% for the seven-day and 30-day periods, respectively. This reduced volatility has created what some analysts describe as a low-cost environment for leverage, prompting traders to take advantage of the pricing dynamics of options.
Option traders prefer bullish exposure despite vented emotions
Dr. Sean Dawson, head of research at Derive.xyz, pointed out that there is a strong bias against bullish positioning among options traders on the platform. Dawson said:
A staggering 73% of all BTC option premiums are used to purchase calls, while Ethereum sees an even higher percentage at 81.8%.
According to Dawson, Cole is at a 3:1 ratio for Bitcoin and above 4:1 for derive’s Ethereum. However, he warned that by deriving activity, it may not fully reflect the sentiment of the broader market as a whole.
The optional data for Deribit, the main crypto-differential exchange, shows a more balanced positioning, with normalized delta skew suggesting mixed emotions.
Derived users appear to be positioned for rising price movements, while other venues reflect more hedged strategies. Still, Dawson argued that in the absence of major shocks, BTC and ETH could remain close to current levels until the end of May. Dawson wrote:
When it comes to price forecasts, BTC’s outlook remains stable, but the downside potential is becoming more bullish. The chance that BTC will fall below $110,000 by May 30th is still at 11%, but the chance that BTC will fall below $80,000 has fallen from 11% to 8%. For ETH, the likelihood of exceeding $2,300 by May 30 remains at 9%, while the chance of falling below $1,600 has dropped from 24% to 21% in the past 24 hours.
Bitcoin on-chain data shows basic enhancements
In parallel with the activities of the derivatives market, on-chain indicators suggest that they strengthen investor trust. A crypto staple analyst known as Yonsei Dent emphasized the new momentum in Bitcoin’s market value in its realised value (MVRV) ratio.
As Bitcoin prices recovered to $94,000, the MVRV ratio rose to 2.12, approaching a 365-day moving average of 2.15. According to Dent, this means that holders currently sit at about 112% of their non-realized profits on average. This is at a level that has been consistent with historically strong market positioning.
Dent added that if the 30-day moving average of MVRV crosses beyond the 365-day trend known as the “golden cross,” it could serve as a confirmation of bullish momentum to resume.
Related readings
This pattern precedes important meetings in previous cycles. However, Dent also emphasized the importance of continuing observation of MVRV trajectories to assess Trend’s sustainability.
Special images created with Dall-E, TradingView chart
