Bitcoin option traders are shifting gears, with their sights set on massive gains as November looms. They’re piling into call options, particularly those with strike prices above $80,000. The timing? Coinciding with two crucial events: the U.S. presidential election on November 5, and the Federal Open Market Committee’s (FOMC) interest rate decision on November 8.
André Dragosch, head of research for Bitwise Europe, dropped some gems on The Block. He noted, “The highest open interest for bitcoin options lands on November 8, right after the U.S. election and during the FOMC meeting.” This has led many to speculate traders are betting on a bullish outcome. Call options, of course, let traders lock in a bitcoin price now, in the hope of higher prices later. That’s classic bullish positioning.
Fed Rate Cut Hype Fuels Bitcoin Optimism
The U.S. Federal Reserve is widely expected to slice interest rates by 25 basis points during the FOMC’s November 8 gathering. The CME FedWatch tool pegs the odds of this happening at a solid 90.2%. A rate cut typically boosts risk appetite, which means more capital could start flowing into risky assets like bitcoin.
Dragosch pointed out, “Option traders are likely banking on heightened bitcoin volatility around the FOMC decision, as reflected in implied volatility curves.” Bitcoin volatility tends to spike during major events, and the FOMC meeting is no exception. This could create major price swings, and traders are positioning for that wild ride.
Big Money Moves: Deribit’s $80K Call Options Surge
On Deribit, a chunky concentration of call options for strike prices between $80,000 and $82,000 has surfaced, with expiration dates set for November 29. There are more than 3,100 contracts in play, representing a fat $212 million in value. In comparison, put options are slacking, with just 1,200 contracts for a total value of $82 million. This shows a massive skew toward bullish bets.
Still, a little hedging action is creeping in. Dragosch pointed to a recent uptick in put options, signaling some traders are getting cautious despite the overall positive vibes.
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