BTC & ETH Price Outlook After $2.7B Options Expiry: Max Pain Levels and Technical Targets
Traders were watching closely this morning as Bitcoin and Ethereum options worth a combined $2.7 billion expired at 8 AM UTC. Now with the dust settled, it appears both Bitcoin and Ethereum have experienced a slight dip in price.
Bitcoin options with a notional value of $2.09 billion expired earlier today, while Ethereum options totaling $624 million in notional value also reached their conclusion. The concept of “max pain price,” which indicates the price level at which option holders face the greatest financial loss, is a crucial element in anticipating price action following such events.
For Bitcoin, the max pain price stood at $98,000, whereas for Ethereum, it was $3,700. Notably, a substantial portion of these expiring contracts were associated with Deribit, a leading cryptocurrency options exchange.
On Deribit, Bitcoin options amounting to $1.83 billion in notional value expired, accompanied by a put/call ratio of 0.85 and a max pain price of $85,000. For Ethereum, the exchange held $259 million in notional value, with a put/call ratio of 0.60 and a max pain price of $2,000.
The lower put/call ratio observed for Ethereum suggested a stronger bullish sentiment compared to Bitcoin leading into the expiry.
However, the overall market conditions have resulted in price decreases for both assets.
Looking at Bitcoin’s technical indicators, the Bollinger Bands had suggested potential volatility, with the upper and lower bands showing a tightening pattern. While the max pain price for Bitcoin was significantly higher than its current trading price, the expiry event has contributed to a downward pressure.
However, should the price of Bitcoin dip below the lower band of the Bollinger Bands, the support level at $85,000 may be tested, which aligns with Deribit’s max pain level.
Ethereum’s Fibonacci retracement levels indicated that if Ethereum could maintain its momentum above the $3,700 level (the max pain price), the next significant resistance would align with the 1.618 Fibonacci extension, found around $2021.20. However, the expiry has seen Ethereum trade below this level.
According to data from CoinMarketCap, Bitcoin is currently trading under $84,000, reflecting a 2.13% decrease over the past 24 hours. Meanwhile, Ether (ETH) trades around $1,950, showing a 2.05% decline during the same period.
Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.
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