According to the latest reports from Greeks.live, options data shows important information ahead of the upcoming US interest rate cuts.
Decline in IVs Across All Major Terms
In a new post on X shared today, Greeks.live notes that options data is showing a significant decline in implied volatilities (IVs) across all major terms. According to their data, market volatility expectations are falling short, and the market theme for September remains oscillating. Implied volatility (IV) is essentially a measure of how much the market believes the price of the underlying asset will move in the future. The 30-day IV shows a volatility metric of 61.31%, the 3-month IV is over 68%, and the 6-month IV is over 71%, according to their graph.
Probability of a 25 Bps Rate Cut
Greeks.live also noted that this week is coming to a smooth end without significant volatility in the crypto market, despite important economic and political events such as the US August CPI results, the presidential debate between former US President Donald Trump and Kamala Harris, and the commemoration of 9/11. US Fed rate cut expectations are gradually converging. According to CME data, the probability of a 25-basis-point rate cut at the upcoming FOMC meeting is now 87%. The probability of a 50-basis-point rate cut is only 13%.
Conclusion
The decline in options market volatility and the high probability of a US interest rate cut are affecting the cryptocurrency market. The Federal Reserve's rate cut decision, expected next week, could have a significant impact on the value of Bitcoin and other crypto assets.
Thus, options data and the Fed's rate cut expectations are key factors influencing the current state and future direction of the cryptocurrency market.
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