SignalPlus Vol Commentary (31 Jul 2024)
After Trump’s endorsement of cryptocurrencies during his speech at the Bitcoin 2024 Summit on Sunday, news broke the following day that the U.S. government was transferring a large amount of Bitcoin. This potential sell pressure led investors to adopt a risk-off sentiment, causing BTC to fall from a high of $70,000 back to around $66,000. Inflows into BTC ETFs also declined, but we saw strong positive inflows into ETFs led by Blackrock ETHA, which offset the selling pressure from Grayscale ETHE. On July 30th, the flow turned positive, providing confidence for price stabilization.
Today, investors are keenly focused on the FOMC meeting at 2 AM. The daily/bi-daily options have already priced in this uncertainty with a high premium. However, the uncertainty of this meeting does not stem from the decision-making itself. According to surveys from international media, nearly all economists expect no change in interest rates. More attention should be paid to Powell’s statements at the press conference that follows. The market expects the Fed might subtly alter its statement to acknowledge recent improvements in inflation and labor market balances. While no significant enthusiasm for rate cuts is expected at this meeting, there might be initial hints of a possible rate cut in September, along with guidance on what indicators to watch next. Investors seeking more explicit signals may have to wait until the Jackson Hole Economic Symposium in August, where the Fed Chair will speak and potentially announce significant information.
In terms of trading, investors heavily purchased put options for protection on ETH for August 2nd, while selling a significant amount of call options in the near to medium term, leading to a decline in Vol Skew during this period. On the BTC side, the market sold call options for August 2nd, capitalizing on the premium brought about by the uncertainty of the FOMC. At the same time, there is ample demand on the far-end top side, exemplified by the purchase of 1000 call options for September at a 95,000-C strike, a Long Risky at 85,000 vs 55,000, and a rollover of call options from December at 65,000 vs 100,000, which pushed up the premium on the topside wing, causing the far-end Vol Skew to lean towards call options.
You can use SignalPlus Trading Compass on t.signalplus.com to get more real-time crypto information. To receive timely updates and engage with a broader community, we cordially invite you to join and follow our official link for seamless communication and interaction with community members:
SignalPlus Official Links
Trading Terminal: https://t.signalplus.com
Twitter: https://twitter.com/SignalPlus_Web3
Discord: https://discord.gg/signalplus
Telegram: https://t.me/SignalPlus_Official
Medium: https://medium.com/@signalplus_web3
Website: https://www.signalplus.com/
Trading Ideas: https://t.me/SignalPlus_Playground
