SignalPlus Vol Commentary (31 May 2024)
Yesterday (May 30), the cooling of U.S. economic data rekindled market confidence in a rate cut. The actual GDP annualized was revised down to 1.3% (previous value was 1.6%), marking a new low since the first quarter of 2023. Both inflation data and consumer spending slightly decreased, while the pending home sales index fell significantly more than expected, recording -7.7%, the lowest since February 2021. After the data release, U.S. Treasury yields erased all the previous day’s gains, with the current two-year/ten-year yields at 4.948%/4.561%, respectively.
In the cryptocurrency market, on the last trading day of the month, BTC and ETH closed at 68,201.52 (+0.62%) and 3,731.97 (+0.12%), respectively. Reviewing yesterday’s market, the release of U.S. economic data boosted the upward trend in cryptocurrency prices, pushing BTC to briefly break above $69,000. However, the price quickly retreated from its peak, falling back to just above $68,000. From the recent trend, it appears that $69,000 has transitioned from a support level to a significant resistance level.
In terms of options, implied volatility has significantly steepened downward. The front end of BTC has dropped by approximately 4–5% again, with the ATM IV within one month returning to below 50%. The IV of ETH is also generally declining, but it remains over 10% higher than BTC across various maturities. The approval date for the ETF S-1 is still unknown, and the market generally believes that the earliest approval would be in July. Over the past 24 hours, ETH trading has shown a relatively clear trend, with a significant number of call options being established in mid-to-late July and the 3000-P puts being sold towards the end of the month.
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