Ether options open interest concentrates at $5,000 calls for end-of-June expiry

The largest cluster of open interest for ether options is currently $5,000 calls for the end-of-June expiry — indicating a bullish outlook with traders using call spreads between $4,000 and $5,000 to position for potential price rises, analysts said.

"When we examine derivatives data, we notice that the highest open interest for ether is currently in the June $5,000-call option," SynFutures co-founder Rachel Lin told The Block.

This observation is supported by data from the Deribit derivatives exchange, which show the largest concentration of ether options open interest is calls at a strike price of $5,000.

Bullish call spreads for end-of-June expiry

According to the latest analysis of options distribution by QCP Capital, data indicates a bullish outlook for ether in the next month, with traders positioning to profit from ether's price possibly rising within a range from $4,000 to $5,000.

The analysis outlined how traders are buying call options with a $4,000 strike price and selling call options with a $5,000 strike price, both expiring at the end of June 2024. 

"The desk observes bullishness in ether, with sizeable buyers of $4,000 to $5,000 ether call spreads for end-June 2024," QCP Capital analysts said.

Put-call ratio shows a bullish skew

Lin added that ether open interest is "65% for calls versus 35% for puts." This concurs with data from Deribit, which shows a put-call ratio of 0.56 for the end-of-June expiry. A put-call options ratio below one indicates that the call volume exceeds the put volume, signifying bullish sentiment in the market.

"The options market has a bullish outlook for June, even as the spot market consolidates, and if the current trend persists, we may be on the brink of another bullish rally in the near future." Lin added.

However, The Block's Data Dashboard shows the put-call ratio for ether options rising throughout the past week across multiple derivatives exchanges. This increase follows the approval, but not the launch, of spot ether exchange-traded funds by the U.S. Securities and Exchange Commission — suggesting that some traders are considering hedging strategies in preparation for potential downsides if the launch of these financial products on exchanges is delayed.

 

Ether spot ETFs were approved by the U.S. Securities and Exchange Commission on Thursday, May 23 — but, unlike bitcoin ETFs, which started trading the day after approval, the ether ETFs may not go live for a few weeks or months . According to QCP Capital analysts, a potential breakout for the ether price will have to wait for more clarity on the S-1 approvals .

Ether's price increased by a muted 0.22% in the past 24 hours and was changing hands for $3,728 at 5:27 a.m. ET, according to The Block’s Price Page . The GM 30 Index , representing a selection of the top 30 cryptocurrencies, increased by 0.3% to 143.29 in the same period.