While the speech of the president of the federal reserve Jerome Powell to Jackson Hole the approach, the key question in everyone’s mind is: the volatile of Bitcoin become?
The answer indicates moderate volatility, not the extreme fluctuations that the widespread attention to the event could suggest.
“BTC options are prices in a displacement of around 2.0% in Jackson Hole’s speech in Powell,” Coindesk Pulkit Goyal, responsible for Crypto market exchanges. Orbit specializes in cryptographic options and structured derivatives.
Traders use the price of options with different prices and compensated deadlines and implicit volatility and Greek options to assess an expected range of pricing. Implicit volatility refers to market expectations on the quantity of underlying assets which should move over a specific time.
Implicit volatility index for a day of Volmex (BVIV1D) increased to 49% annualized at the editorial staff, the highest since May 26, according to Data Source TradingView. This is equivalent to a 24 -hour price swing of 2.5%. It is slightly higher than the average daily movement of 1.18% in the last 30 days.
Note that volatility is the management agnostic, which means that the price swings indicated by the options and the implicit volatility indices can take place in both directions.
That said, downward volatility seems more likely in case Powell seems balanced, widespread expectations contrasting for rate reduction advice. Some traders bought put options preparing for such a result.
“If its tone is more balanced than Dovish, the markets could see a retirement, which led to the demand for downward protection. The bias tells the story: the risk inversions of 25 Delta of the day has currently increased to 6 flights,” Goyal told Coindesk.
Powell is expected to speak on Friday morning at the Annual Economic Policy Symposium of Jackson Hole de la Fed.
