Traders Anticipate Bitcoin and Ethereum Downturn Amid Rising Put Option Activity

PANews reported on August 6th that with the Federal Reserve leaving interest rates unchanged, traders have shifted to bearish positions in Bitcoin and Ethereum options, focusing on key strike prices.

BTC
ETH

Summary

According to PANews and Derive data from The Block, unchanged Fed interest rates have contributed to a cautious market sentiment. Traders are favoring put options for Bitcoin and Ethereum expiring on August 29, with Ethereum puts exceeding calls by over 10% at strike prices of $3,200, $3,000, and $2,200, while Bitcoin put options are nearly five times the call volume at strikes of $95,000, $80,000, and $100,000. Derive estimates a 25% probability for Ethereum falling below $3,000 and an 18% probability for Bitcoin dropping below $100,000.

Terms & Concepts
  • Put options: Options contracts granting the holder the right to sell an asset at a predetermined price, used to hedge against potential price declines.
  • Open interest: The total number of outstanding derivative contracts that have not been settled, representing market participation and liquidity.