Will It Lead to More Market Losses?

Around 92,500 Bitcoin options contracts will expire on Friday, May 30, and they have a notional value of roughly $10 billion.

This week’s event is larger than usual as it’s the end of the month, which could induce more volatility into markets that have been in retreat for the past several days.

Crypto Options Expiry

This week’s batch of Bitcoin options contracts has a put/call ratio of 0.87, meaning that there are slightly more long contracts expiring than shorts as sentiment cools. There is also a max pain point of $100,000, around $6,000 below current spot prices, which is where most losses will be made on contract expiry.

Open interest (OI), or the value or number of BTC options contracts yet to expire, is highest at the $120,000 strike price, which has $1.7 billion, and there is an additional $1.6 billion in OI at the $110,000 strike price as bullish speculators remain confident, according to Deribit.

https://twitter.com/DeribitOfficial/status/1928008880044261738?ref_src=twsrc%5Etfw” data-wpel-link=”external” target=”_blank

In a recent update on May 30, crypto derivatives provider Greeks Live said, “The market is still more optimistic about BTC breaking out to new highs in the near future.”

It added that the put/call ratio for delivery is falling, and “above $100,000, this price has lasted for the entire first half of the year.”

“Crypto institutions are not showing much reaction to the new highs in the pie, with low expectations for a near-term surge, and more expectations for a steady, moderate rise.”

In addition to today’s batch of Bitcoin options, there are around 624,000 Ethereum contracts that are also expiring today, with a notional value of $1.62 billion, a max pain point of $2,300, and a put/call ratio of 0.81. This brings Friday’s combined crypto options expiry notional value to around $11.5 billion

“The upward shock of the ETH [move] has begun to slow down, and the market has recalibrated the price of the ETH and volatility, which has risen slightly overall,” Greeks commented.

Crypto Market Outlook

The crypto market decline has accelerated over the past 24 hours, with total capitalization dumping 4.4% to $3.46 trillion.

Bitcoin is leading losses, with the asset dropping below $106,000 during the Friday morning Asian trading session in a 2% daily dive.

Ethereum’s momentum is waning as ETH dumped 5% on the day, dipping below $2,600 on Friday morning.

As usual, the altcoins are a sea of red with larger losses for Solana, Dogecoin, Cardano, Hyperliquid, Chainlink, and Avalanche.