Cryptocurrencies have experienced a resurgence in August after a brief slowdown in July. The inclusion of private assets in 401(K) plans has sparked renewed interest.<\/p>\n
Bitcoin has climbed above $120,000, while Ethereum has surged past $4,000. For Ethereum, surpassing $4,000 is a noteworthy milestone, as it had previously acted as a ceiling on its price movement.<\/p>\n
The recent breakout suggests further potential for price increases. The focus is on how much higher prices may go, rather than if they will reach previous highs.<\/p>\n
This period has been characterised by intense buying of risky assets, defying the usual trend of momentum cooling during this time. The current year has marked a distinct change, turning this summer into a season dominated by crypto and collectible booms.<\/p>\n
The sustained break above key levels, especially Ethereum at $4,000, suggests a strong bullish trend is now in play. Derivative traders should consider maintaining or initiating long positions in futures contracts to ride this momentum. The recent 401(k) news provides a fundamental reason for this move, suggesting a steady stream of new capital that we haven’t seen before.<\/p>\n
With this feverish buying, implied volatility is spiking, making the purchase of call options increasingly expensive. We’re seeing the Crypto Volatility Index (CVI) push above 90, a level that historically signals euphoria but also high premiums. A more prudent strategy could be selling cash-secured puts or using bull put spreads to collect these rich premiums while maintaining a bullish outlook.<\/p>\n
This isn’t just retail excitement; institutions are heavily involved and are confirming the trend. Open interest on CME Bitcoin futures just surpassed a record $25 billion last week. This high level of participation from large players suggests they are positioning for further upside in the coming weeks and months.<\/p>\n
The options market is pricing in a significant move higher, with a strong bias for more gains. The 25-delta skew for both Bitcoin and Ethereum options remains deeply positive, showing traders are paying a steep premium for call options relative to puts. This indicates a broad consensus that the path of least resistance is up.<\/p>\n
We saw a similar setup in late 2020 when institutional news first began driving the market, which led to the massive rally into 2021. While the trend is our friend, it is wise to use trailing stops on futures positions to protect profits. Taking some money off the table on long call positions can also help manage risk if the market suddenly turns.<\/p>\n","protected":false},"excerpt":{"rendered":"
Cryptocurrencies surged in August, with Bitcoin topping $120,000 and Ethereum breaking past the $4,000 ceiling.<\/p>\n","protected":false},"author":62,"featured_media":0,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-28712","post","type-post","status-publish","format-standard","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/28712","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=28712"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/28712\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=28712"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=28712"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=28712"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}