A hidden hint from the derivative market suggests that ether (Eth) The rally can be intensified, raising the evaluation quickly up to $ 4,400.
Under consideration indicators Derbit-list Ether options are the net gamma exposure of dealers/market manufacturers in the market. The gamma option is important metric for traders, measuring how the delta of an option, or its sensitivity to the price of the underlying asset changes in response to the market steps.
When the dealers are small gamma, they are forced to buy the underlying property as its price increases and its price falls, which often increases directional moves. Dealers provide liquidity to the order book and earn money from the bid-back, making constant efforts to maintain the prices of prices.
According to the data source Amberdata, at the press time, the strike was a notable construction of the short gamma between $ 4,000 and $ 4,400. With the ether crossing above $ 4,000, dealers can buy property to hedge their exposure, making a self-rhinforing positive feedback loop that can rapidly increase the price by $ 4,400. This is a level where the gamma dynamic makes positive changes, which requires dealers to trade against the market and arrest price volatility.
It creates a logical value magnet for the ongoing rally on $ 4,400.
“If the market is strong enough to get through $ 4,000, we see that the dealers also become a net buyer of ETH at high prices, possibly $ 4,400 for a quick rally, leading for the next large gamma inventory level,” Greg Magadini, director of Darivatives, told Coindsk.
