Ethereum Option Data Reveals Significant Increase in Call Options!

• According to data from the Deribit derivative exchange, there is an increasing number of call options in Ether options open positions as the expiration date approaches at the end of January.
• A put-call option ratio lower than one indicates that the volume of call options exceeds that of put options, signaling a bullish trend in the market.
• There has been a significant increase in open positions in ether options as the end-of-month, end-of-quarter, and end-of-year expiration date approaches.

Ethereum’s options data on the Deribit exchange reveals that positive sentiment for ETH is increasing: All the details!

Option Data for Ethereum Indicates What?

According to data from the Deribit derivative exchange, as the end-of-January expiration date approaches, there is an increasing number of call options in Ether options open positions. This suggests, according to an analyst, that many investors anticipate the digital asset’s price to rise in early 2024.

Luuk Strijer, Deribit’s Trading Director, said, “If you look at the year-end Ether expiration date, the put-call ratio is 0.44, meaning a ratio of 4.4 puts to 10 calls. However, in January 2024, this ratio is 0.19, which means about 2 puts for 10 calls, a much more bullish split.”

A put-call option ratio lower than one indicates that the volume of call options exceeds that of put options, signaling a bullish trend in the market. A trader buying call options is assumed to be implicitly bullish on the market, while put buyers expect the market to decline. According to the data, today’s ether put-call option ratio on Deribit is 0.35.

Deribit data also shows that there are more than twice as many assets relative to call options before the December 29 expiration date. The largest group of approximately 974,000 call options expiring at the end of the month is at the $2,500 strike price. This indicates that many derivative traders are betting that the price of ETH will rise above this level by the end of December.

Increase in open positions in Ether options

As the expiration date approaches at the end of December, end of the quarter, and end of the year, there has been a significant increase in open positions in ether options. “The end of December is currently Deribit’s largest expiration,” said Strijers. Strijers added, “There is currently $3.3 billion of the total $7 billion Ethereum option conceptual open position expiring on December 29, almost 50%.”

An increase in open positions indicates that new money is entering the market, signaling increased participation and potential liquidity. It also indicates the entry of experienced traders into the cryptocurrency market and the promise of better price discovery. Options are derivative contracts that give a trader the right to buy or sell the underlying asset at a specified price on a specific date or within a specific time frame. While a call option gives the right to buy, a put option gives the right to sell.