Summary
- Option traders are using a bull call spread strategy, forecasting Ethereum to reach $6000 by year-end.
- By buying $3500 call options and selling $6000 call options, traders aim for maximum profit if Ethereum reaches $6000 by year-end.
- Analyst Greg Magadini evaluated the potential rebound due to the launch of a spot ETF including staking as a significant catalyst.
An analysis has emerged that option traders are forecasting Ethereum (ETH) to reach $6000 by year-end.
On the 20th (local time), CoinDesk reported, "Last week, there was a surge in institutions and large traders using the 'bull call spread strategy' as they anticipated a rise in Ethereum," adding, "They bought call options with a strike price of $3500 expiring on December 26 (local time) while simultaneously selling the same amount of call options with a strike price of $6000." It is known that more than $7 million was invested in this trade.
The media evaluated, "Traders using this strategy will achieve maximum profit if Ethereum exceeds $6000 by year-end," reflecting strong expectations for reaching $6000 by year-end.
Greg Magadini, a derivatives analyst, said, "Now is not the time to predict Ethereum's peak. The possibility of a rebound is high," adding, "The launch of a spot ETF including staking will act as a significant catalyst for the rise."
Meanwhile, a call option is the right to buy a specific underlying asset at a predetermined strike price. A call option buyer can exercise the option if the market price of the underlying product is higher than the predetermined strike price on the expiration date, gaining the difference as profit. Conversely, a put option is the right to sell an asset at a predetermined strike price.
Son Min
sonmin@bloomingbit.ioHello I’m Son Min, a journalist at BloomingBit
