Bitcoin options show that traders are hedging prices to price draws to price levels of $100,000 due to increased geopolitical and economic uncertainty across global financial markets.
Crypto Derivatives Exchange Deribit’s call volume to call volume ratio has skyrocketed to 2.17 over the last 24 hours, reflecting a strong slope towards protective bets. Putting the option of offering negative side insurance by granting contract owners the right to sell at a specific price, particularly in short-term contracts, demand has arisen. For options that expire on June 20th, open interest on Puts’ $100,000 hits the top of the board, highlighting concerns about a short-term price drop with a 1.16 Put-to-Call ratio.
Bitcoin It reached an all-time high of $111,980 on May 22, and is up over 50% as the now-crypto-friendly Donald Trump was elected second president of the US in November. The biggest cryptocurrency changed little on Wednesday at around $104,377.
Care is taken as Federal Reserve policymakers navigate a highly uncertain environment as geopolitical tensions and unstable energy prices in the Middle East increase inflation and labor market risks. As U.S. officials are widely expected to stabilize policy at the fourth consecutive meeting later Wednesday, the market will focus on the latest forecasts on the Fed’s growth, unemployment rates and interest rates.
“The Hawkish signal from the Federal Reserve could bolster the US dollar and trigger a psychological test of the $100,000 mark,” wrote Javier Rodriguez-Alarcón, Chief Investment Officer of XBTO in a memo. “At the same time, the geopolitical situation remains a wildcard. While reliable emissions in the Middle East could serve as a major risk-on catalyst, further deterioration could lead to another move across risk assets.”
