Bitcoin (BTC) and Ether (ETH) hit new highs this week as a series of bullish news continued to give investors hope that the next cryptocurrency bull market will mimic the 2017 market.
Many novice traders monitor spot prices on major cryptocurrency exchanges in order to gauge the direction in which price may move. A review of market data for options can provide a more up-to-date view of market sentiment.
Looking at the recent bitcoin options activity, it is clear that some of the trades went on strike, which seemed unlikely to even the most optimistic analysts. These trades include 20 BTC CME call options in December with a $ 70,000 strike and 56 BTC for $ 100,000 in December on LedgerX.
These anecdotal trades may not reflect broader market conditions, but oddly enough, the highest ether options contract for December 2020 is $ 1,120. This trade is undoubtedly bullish given that there are only 42 days left before expiration, but not even close for BTC options expected to rise 330% or more.
In particular, Deribit also has Ether Call options for March 2021 with strikes up to $ 1,600. While this effect may be related to the Ethereum 2.0 launch date of December 1, the upside is 230%. This is much less than alternatives to Bitcoin.
As the data above shows, only 28% of the $ 613 million open interest in Ether options is $ 460 and up. This situation can be partially explained by the 23% rally that has occurred in the last 10 days, which indicates that traders were not expecting these prices.
It is also important to remember that options until March 2021 are listed on most stock exchanges. Therefore, we should expect some optimism in the future. It is relatively cheap to buy options above market prices. The $ 600 ETH call sold in January 2021 for $ 12 just two weeks ago.
Traders are more optimistic about bitcoin
When you compare this data with the bitcoin options markets, there is a clear difference. BTC options are noticeably more optimistic, and there have been $ 50,000 call options for a long time in June and December 2021.
Note that unlike the ether markets, there are huge rates in excess of $ 17,000 here. This time, 40% of open BTC options worth $ 3.75 billion are $ 16,000 or more.
Bitcoin is up 18.5% in the last 10 days, so these upbeat games seemed unrealistic at the time. Thus, the recent rally in ETH should not be an excuse for the lack of overly optimistic options.