TI Weekly Option Market:Ethereum is relatively Strong

TI Research

In the third week of November, both Bitcoin and Ethereum encountered significant downward pressure. We can see that market sentiment has been significantly suppressed, and Bitcoin has been more prominently affected by this adjustment. Investors are reminded that the spot price of Meme tokens has been cut in half, and investors are returning to rationality.

  • Whether it is Bitcoin or Ethereum, the position structure is moving to the left;
  • The average holding time of spending bitcoins on the chain has dropped;
  • Ethereum is still in a relatively strong form, and investors have allocated a large number of call options with a strike price of 5000.


The market in November was more general. Bitcoin dropped by 15% from its October high. The downturn in the spot market was the main factor in the change in position structure. Specifically, investors' positions have moved to the left very obviously, and some investors even bought call options with a strike price of $40,000.

Observing the transaction activity on the chain, according to the latest data from Glassnode, the current average holding market for spending bitcoins on the chain is rapidly decreasing. We believe that there are two reasons behind this phenomenon: first, in the process of market decline, many short-term holders are spending a lot of bitcoin; second, as the spot price declines, long-term holders slow down the spending of bitcoin speed.


In the past seven days, the price of Ethereum has outperformed Bitcoin. From the perspective of the option holding structure, although the spot price has seen a sharp decline, the shift in the holding structure is not obvious. In the context of active economic activities on the chain, the price of Ethereum still has a solid foundation.

Judging from in-depth market data, the implied volatility of Ethereum has fallen relatively quickly, and investors are not strongly disagreeing with the market. At the same time, due to market adjustments, the skewness of Ethereum options was once reduced to a negative value. As the market stabilized, the skewness of option values remained near 0. In such a market environment, the short side may have the upper hand.


In November 2021, US President Biden nominated Jerome Powell for re-election as Chairman of the Federal Reserve Board. If the nomination is approved by the Senate of Congress, Powell will begin a second four-year term in February 2022. Regarding Powell's re-election, US bond interest rates have risen again, and the reversal of the macroeconomic situation may have become a trend. The market has formed a phased consensus on the interest rate hike next year. According to the fund flow data released by Coinshares this week, the digital asset fund flowed in at $153 million last week, of which bitcoin flow was $110 million. The flow of funds is a leading indicator of the market. For the time being, the expectation of tightening liquidity has not had an impact on cryptocurrency.


TI Research

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