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87,000 bitcoin options are set to expire across major crypto markets on Friday the 25th of September, 2020 and this might just have a significant impact on the market as he Cryptomarket is expecting another bearish shock wave.
This follows an already down-trending bitcoin market with the price of btc dropping by over 4% and remaining in consolidation in the past couple of days.
In this piece, we take a simple look at what Options Contracts are, the two types of contract options and the possible implications of the forthcoming expiration events
An options contract gives you the right not the obligation to sell or buy and underlying asset at a predetermined price on or before the expiry date.
The option contact allows you to profit if the underlying asset moves in your favour before the expiry.
There are two basic types of options:
Call options and Put options.
Call options give contract owners the right to buy the underlying assets while Put options gives the right to sell.
For instance, you can buy a “Call” option with the expectation that the asset price will rise in the near or coming future. Also, the instance for which to hold a “Put” option is when the expectation is for a future fall in the price of the underlying asset.
Following the breaking news of the said options contract expiration, there are two possible sides to the coin. Analysts and experts believe that the overall implications could be two-faced.
While some are of the belief that this spells doom and a possible increase in momentum for a longer bearish season, others are optimistic that the market might just kick off from there following bullish buy back.
The current state of the market provides for a real cause for concern as the situation renders a lot of the current options traders handicapped.