While the leading cryptocurrency Bitcoin (BTC ($80,569.40)) and altcoins were going through difficult days, there were sharp declines.
As BTC fell below $80,000, a level not seen since November, today, as every Friday, the expiration date for options contracts in the crypto market has come.
These options are even more important because they fall on the last Friday of both the week and the month.
According to the news of Singapore-based crypto options data platform Greeks.live, 59,000 Bitcoin and 529,000 Ethereum options will expire on February 28 on the Deribit derivatives exchange.
Accordingly, the Put/Call Ratio of BTC options is 0.7, the maximum loss point is $96,000 and the notional value is $4.66 billion.
When we look at Ethereum, ETH ($2,130.76) options have a Put/Call Ratio of 0.52, a maximum loss point of $3,000, and a notional value of $1.12 billion.
Impact on Bitcoin and Ethereum Prices!
Greeks.live analysts said that a downtrend is dominant in the market and that investors see $82,000 as a critical support level that must be protected for the long-term rise to continue.
The “maximum loss” price is the level where option buyers suffer the greatest loss and market makers see the greatest profit. At this point, the closer the Bitcoin price is to $96,000 and the Ethereum price to $3,000, the greater the loss option investors will experience, so major players and market makers in the market usually try to push the price to these levels. Also, historically, as options approach expiration, prices tend to drift toward the maximum pain level, making $96,000 for BTC and $3,000 for ETH a critical level to watch.
What Does the Put/Call Ratio Signal for Bitcoin and Ethereum?
The put/call ratio is calculated by dividing the number of put options by the number of call options. A ratio below 1 means there are more buys than puts, indicating an uptrend. A ratio above 1 means there are more puts than calls, indicating a downtrend. A ratio close to 1 means the market is balanced or neutral.
For Bitcoin, this ratio is 0.7, indicating that the upward trend is still ongoing. For Ethereum, it is 0.52, indicating an upward trend.
Accordingly, these rates indicate an upward trend for BTC and ETH. However, time will tell how these rates will affect the price. At this point, do not make your investment decisions based on a single data or report.
*This is not investment advice.
Continue Reading: $5.7 Billion in Options to Expire in Bitcoin and Ethereum! Here Are the Most Critical Price Levels to Watch! creator solana token
