Ethereum has seen bouts of hikes and falls this month with single-day increases touching almost 11.3% and single-day falls sitting at 10.5%. In such an unforeseen market, the question is why people are turning bearish for Ethereum.
And, even if they are, what are the chances of Ethereum actually falling further?
Do investors want Ethereum to fall?
Not all, of course. The observation comes from data from Deribit’s sales and purchase contracts. According to the same, trading volumes of Puts Options have been as high as 31k, amounting to more than $90 million. These options are primarily aimed at Ethereum to reach $ 2,700.
Now, since Deribit represents almost 96% of all Open Interest in the Options market, it can be considered as almost all of the market’s opinion.
This observation occurs despite the fact that for more than a month now, the options market has been on the rise. The Implied Volatility (IV) to Realized Volatility (RV) spread signals this as the IV has been superseding RV for a while now.
And, with implied at-the-money volatility (ATM) reaching over 100% for all months 1, 3, and 6, the market can expect price movements in the positive direction.
There is also a 60% domination of Calls Options for contracts expiring on 1 October where investors are coveting for Ethereum to hit $3200.
But again, there is also a 40% dominance on Puts that expires on October 1, in addition to those that expire on October 8.
What are the chances of Ethereum dropping?
Nothing can be said with any certainty, but there is a fair chance of a price fall happening. According to the probability index, for example, in October, there is a 54% chance that Ethereum will drop to $ 2,700.
If the market wants to reduce this 54% probability and avoid a fall, some buying pressure is needed stat. The price for the week has already fallen by 12.3%. Looking at the RSI and the SAR movement, no immediate change in trend is guaranteed either.
