Traders and investors are bracing for increased volatility among cryptocurrencies as Bitcoin (BTC) options contracts worth $9.4 billion are set to expire on November 29.
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Ethereum (ETH) options worth $1.3 billion will expire on the last trading day of the month as well and heading into the American Thanksgiving weekend. Volatility in the crypto market is expected to spike in coming days as investors and traders look to close their BTC and ETH bets and book profits.
An option allows the holder the right, but not the obligation, to buy or sell an underlying asset at a specific price within a set period. At the end of October, Bitcoin’s price declined 3% as more than $4 billion of options expired. Traders are bracing for an even more volatility as November comes to an end.
BTC to Surge?
Some analysts are warning that Bitcoin’s price could surge in coming days as options traders who bet on a decline in the cryptocurrency’s price are forced to buy BTC to cover potential losses. With Bitcoin rallying more than 30% since the November 5 U.S. election, many options traders who bet on a decline in the price are in the red and facing losses as the month closes out.
Options traders buying Bitcoin to stem their losses could push the price of BTC above the key threshold of $100,000, say some analysts. Bitcoin is currently trading at $96,125, having gained 132% so far in 2024. Crypto bulls are eagerly awaiting for the digital asset to rise above the $100,000 milestone.
Is BTC a Good Buy?
Most Wall Street firms don’t offer ratings or price targets on Bitcoin, so instead we look at the cryptocurrency’s three-month performance. As one can see in the chart below, the price of BTC has risen 52% in the last 12 weeks, which is an extremely strong showing and outpacing U.S. equities.
