E Point Perfect

Ethereum Volatility May Spike Massively Today, Here’s Why


article image

Arman Shirinyan

Ethereum might make move on market as one of first volatility sources appears today

For the last six days, the average daily volatility for Ethereum was at a relatively low level following the sudden price plunge that happened on Aug. 19. The low volatility period will most likely come to an end after we see an options expiry, which usually correlates with large volatility spikes on the market.

A total of $1.1 billion worth of derivatives is going to expire today, with more than 400,000 calls and 330,000 puts. The max pain price for August 26th options is $1,500, which means the asset has more chances to swing toward the lower price from $1,652.

Ethereum Chart
Source: TradingView

According to open interest distribution, options traders did not believe in Ethereum’s ability to reach higher levels like $2,000. Despite the prevailing number of calls, many positions have been opened as hedges against the potential spike in volatility.

As for September’s options, investors are mostly “betting” on Ethereum remaining around the price we see on the market today, with the max pain price staying at $1,600, though we can see some investors opening $10,000 ETH contracts. Traders should not be confused by it as someone might use extreme values for hedging their large short positions or for any other unconventional reason.


Ethereum’s price performance

Despite the unsuccessful attempt to reach the local peak of $2,000 and the following reversal, Ether is still moving in the local uptrend and holding above the 50-day moving average, which as an important condition to be met.

At press time, the second biggest cryptocurrency is trading around $1,654 and showing a 2.4% price correction in the last 24 hours. The expiry of the aforementioned options will happen today.


Source link

Related posts

Ethereum (ETH) Investors Bet Big on Next Upgrade’s Success

Sui Blockchain RPC Added by Ankr API Provider

Uniswap Just Raised $165 Million to Build NFT Aggregator, Here’s What For

Record 150 Billion SHIB Sent by This Anon Wallet, But There’s Catch

You Can Arbitrage Ethereum (ETH) If This Happens

Will Legendary Investor Jim Rogers Buy Crypto? Here’s What He Has to Say