Ethereum (ETH) experienced a notable decline on Thursday as approximately 228,000 ETH options, valued at around $730 million, reached their expiry. This development marks the continuation of a challenging trend, with the cryptocurrency now facing its third consecutive monthly drop.
The expiration of these options coincided with the expiry of $3.95 billion in Bitcoin (BTC) options. Data from Greeks.live indicated that the maximum pain point for Ethereum options occurred at a price level of $3,475, a figure that has contributed to the negative sentiment currently permeating the market.
Market dynamics have shifted significantly, with both leading cryptocurrencies experiencing price drops. Bitcoin has fallen below the psychologically significant threshold of $100,000, which has further affected overall market sentiment, shifting it from neutral to negative.
Moreover, Greeks.live highlighted that the implied volatility (IV) for both cryptocurrencies is on the rise. While Bitcoin”s near-term IV stands at approximately 45%, Ethereum”s metrics are even more pronounced, with major expiries exceeding 70% and short-term IV nearing 100%. This suggests that traders are preparing for potential significant fluctuations in Ethereum”s price.
Despite the adverse price movements, some on-chain indicators paint a more optimistic picture. An analyst from CryptoOnchain reported that significant Ethereum holders withdrew over 413,000 ETH, equating to more than $1.4 billion, from the Binance exchange. This represents the largest single-day outflow since February and is often interpreted as a sign of long-term confidence, as it reduces the available supply for immediate sale.
From a technical analysis perspective, there are indications that a rebound could be possible. Recent assessments indicate that Ethereum has regained its 50-week exponential moving average against Bitcoin, a level that has historically preceded substantial rallies. Chart patterns also point to bullish targets near $4,400, provided Ethereum can maintain its position above $3,000.
However, overarching macroeconomic uncertainties remain. The recent 43-day U.S. government shutdown has created a vacuum of data, leading markets to depend on projections. With the potential for interest rate cuts now uncertain and the Federal Reserve expected to maintain a hawkish stance, the crypto market appears to be in a cautious “wait-for-signal” mode. Analyst Doctor Profit has warned that further declines may be on the horizon, predicting a drop for Bitcoin into the $90,000-$94,000 range.
