Bitcoin Options Traders Split Ahead of Fed’s Jackson Hole Meeting

Bitcoin traders will go on Friday in the Federal Reserve chairman Jerome’s long-awaited speech on the Jackson Hole Symposium on Friday.

With conflicting macro -economic signals and mixed investor sentiment, the directional bias remains unclear for US shares and crypto.

The CPI report of July, delivered earlier this month, gave a bullish signal with a rate reduction hope, which encouraged a crypto-market trally that Bitcoin pushed to a record high in the first two weeks of August.

However, the subsequent PPI data release has increased inflation problems, so that ambiguity is further aggravated about whether the FED is planning to lower the rates this year, including next month.

Bitcoin has fallen from 8% of his 14 August of all times from around $ 124,128 to $ 114,170 after a sharp decrease in the last seven days, Coentecko Data shows.

Although Bitcoin is in the vicinity of record highs, “the market praises about an 85% chance of a rate reduction during the September FOMC meeting,” said John Haar, director of Swan Bitcoin, said Decrypt.

“Powell will probably keep his comments relatively neutral to keep his options open,” added Harr.

To cut or not cut, that is Powell’s question

While bond traders hold that a reduction will arrive in September, the uncertainty has led to a split into the expectations of investors and bets on the derivatives market.

The “Block Bullish and Bearish trades were almost the same,” said Adam Chu, lead researcher at Greekslive, an options trade platform, said Decypte.

Even with a clear trade volume, “short -term implicit volatility,” said Adam, which indicates that “institutional investors are not very optimistic that this meeting will cause considerable volatility.”

In any case, the market reaction depends on Powell’s tone.

“It is clear that many investors hope for a rate reduction,” said James Genntzke, CFO at Exodus, said Decrypt.

Gernetzke believes that although a rate decision may not become clear until future data is released, investors still have to “take a bill from his tone – this will matter just as much as the details.”

“Bitcoin and Crypto assets are sensitive to global liquidity conditions and must respond beneficial to any further signal that the FED will continue on its Dovish path,” said Gerry O’Shea, head of the global market insights at Hashdex, said Decrypt.

However, a ragless tone could cause a renewed sale in shares and crypto.

But Gernetzke also offered a nuanced image and noted that this cryptomarkt cycle “is atypical because of regulatory wind wind” and institutional adoption, which could “mitigate the blow of a Hawkish Powell.”

O’Shea reflected that sentiment and argued that any negative decision on the rates would not affect the long -term investment case for crypto, supported by institutional adoption and a favorable policy of the White House.