Macroeconomic Factors: How They Influence Crypto Prices
According to Deribit data, 23,832 Bitcoin contracts, valued at approximately $1.37 billion, expired today. This tranche was higher than last week, when 18,339 contracts expired. These contracts had a put-call ratio of 1.09, with the maximum pain point at $58,500.
In the crypto options market, the maximum pain point represents the price level that causes the most financial pain for options holders. The put-call ratio indicated a prevalence of call options (bullish bets) over put options (bearish bets).
In addition to the Bitcoin options, 156,792 Ethereum contracts, with a nominal value of over $488.05 million, also expired. Ethereum’s put-call ratio was 0.38, with the maximum pain point at $3,100.
This week, broader economic factors influenced the crypto market. On July 11, the Bureau of Labor Statistics (BLS) released the US Consumer Price Index (CPI) data, showing an annual inflation rate of 3% for June, which was below market expectations.
Bitcoin briefly reached $59,000 during the recent economic updates, while Ethereum traded at $3,105, showing a slight increase. This positive development occurred despite market pressure from significant Bitcoin sales by the German and US governments. Greeks.live crypto analyst Adam provided insights into the current sentiment in the options market. He wrote:
“The overall implied volatility (IV) level has recovered significantly. If you choose a higher IV, you can open a sell order. The large amount of funds delivered in the quarter will counteract the IV at any time.”
Historically, sharp price movements due to options expiration have tended to be temporary, with markets stabilizing soon afterward. Nevertheless, traders should exercise caution and analyze technical indicators and market sentiment to navigate this volatile period effectively.
