Bitcoin won nearly $108,000 over the weekend. Traders focused on the High Stakes Week of the global macro event hosted by the European Central Bank's Annual Policy Forum on Tuesday with the arrival of Sintra and Federal Reserve Chair Jerome Powell.
Although price action has been muted, signals from the derivatives and chain markets suggest that volatility could return soon. Traders are closely watching the shift in central bank rhetoric that could lean risk appeals in both crypto and traditional markets.
“Whales are moving in large quantities into centralized exchanges,” said Axel Adler Jr., an independent on-chain analyst and frequently encrypted contributor.
Adler notes that this pattern, combined with a decline in exchange reserves and weakening of influx of stubcoin, typically precedes a period of rising volatility.
“As long as Bitcoin holds $108,000, the basic scenario is a target upward movement of $112,000,” he wrote to him. Adler's Insights Newsletter on sunday.
The background is that Powell is expected to repeat the Fed's cautious stance on interest rates, citing the need to make inflation and the labor market more clear before the easing begins.
The ECB Forum “adapted to change” ECB Forum will feature Powell along with ECB President Christine Lagarde and other central bankers.
Even before Sintra, derivative traders began placing around the volatility pivot.
On Saturday, Volmex Finance founder Cole Kennelly pointed out $806,000 in the ever-recent trading volume of GTRADE's synthetic Ethereum and Bitcoin Volatility Index. The rapid increase suggests an increasing demand for exposure to directional volatility as markets await policy clues.
Bitcoin Options Activities reflect that attention.
“Around 20% of derive's open interest is clustered around Minuspat,” said Nick Forster, founder of derive.xyz. Decryption, It highlights a $100,000 position of $85,000 and a $106,000 strike. “Bitcoin traders are prepared for macro uncertainty or profit after rally.”
In other words, the options market shows that bitcoin traders are cautious and close out their putts on lower strikes, contrary to the risks tied to the macroeconomic background.
In contrast, the Ethereum market is bullish, with call activity at a height of $2,900 and $3,200, Forster said.
“This positioning appears to be driven by the ETHCC forecast in Cannes, a major event historically related to product launches and ecosystem growth,” added Forster. “Traders are hoping for a catalyst that will clearly drive upward momentum.”
