Crypto market braces for a possible crash this week as monthly options expiry, as well as the US PCE inflation data release draw near, per recent news. Over $11.7 billion in crypto options are set to expire on the largest derivatives exchange, Deribit.
At the time of writing, Bitcoin (BTC) and Ethereum (ETH) prices had already begun to decline, suggesting rampant volatility and uncertainty in anticipation of the significant market events.
$10B in Bitcoin (BTC) Options Expiry
As per Deribit , 92K BTC options with a notional value of $7.7 billion are set to expire on Friday, with a put-call ratio of 0.88. The max pain point is $100,000, indicating high odds of further retracement.
Moreover, the 24-hour put volume was higher than the 24-hour call volume. The put-call ratio was 1.01, indicating traders are buying more puts than calls. This signals a rise in bearish sentiment.
Bitcoin (BTC) Options | Source: Deribit
Bitcoin price fell over 2% in the past 24 hours, with the price trading at $106,615 at the time of writing. The 24-hour low and high were $106,512 and $108,910, respectively. Furthermore, the trading volume has increased by 7% in the last 24 hours, indicating a rise in interest among traders.
$1.7B in Ethereum (ETH) Options to Expire on Friday
565K ETH options with a notional value of almost $1.7 billion are set to expire, with a put-call ratio of 0.83. Also, the max pain point is $2,300, which is higher than the current price of $2,649.
Traders must keep an eye on drastic changes in trading volumes as the crypto market crash can result in a further volatility in ETH prices.
Ethereum (ETH) Options Open Interest | Source: Deribit
ETH price fell over 5% from the 24-hour high of $2,787 on Thursday, with the price trading at $2,648 at the time of writing. As per CoinGlass data, total ETH futures open interest dropped 3.60% to $36.27 billion.
Crypto News: Liquidations Hints at Trade Shifts
Coinglass data indicated over $335 million in crypto liquidations, with 96K traders liquidated in the last 24 hours. The largest single liquidation order of btcusdC valued at $9.83 million happened on crypto exchange Binance.
Nearly $220 million long and $115 million short positions were liquidated. Most liquidated cryptocurrencies included BTC, ETH, SOL, DOGE, and TRB.
Popular analyst Michael van de Poppe suggested a weekly bearish divergence on Bitcoin dominance, implying potential trend reversal from an uptrend to a downtrend.
Market Cap Bitcoin Dominance Weekly Chart | Source: X
Macro Factors Double Down Selloff Risks
The U.S. Bureau of Economic Analysis to release the U.S. Federal Reserve’s preferred inflation gauge US PCE data on May 30. The annual PCE is expected at 2.2%, down from 2.3% last month. Also, the month-over-month inflation is forecasted to rise 0.1% after a 0% increase in the previous month.
The annual core US PCE inflation is expected to fall to 2.2% , in line with market expectations and the same as in the earlier month. The monthly core PCE is expected to rise 0.1%, up from 0% last month.
Interestingly, the US dollar index ( DXY ) has dropped 0.54% to 99.33 ahead of PCE inflation data. Moreover, the US 10-year Treasury yield also dipped to 4.424%.
However, per recent crypto news updates, Bitcoin and Ethereum prices continued to fall, indicating that traders turned cautious ahead of the options expiry.
Moreover, the US Fed Chair Jerome Powell met with President Donald Trump on Thursday, reported Reuters. However, Powell clarified that the interest rate decisions will depend on data and outlook.
