Crypto stocks experienced a notable rebound on Friday, with significant gains recorded by Coinbase (COIN), MicroStrategy (MSTR), and Bitmine Immersion (BMNR), each seeing a leap of 4-6%. This recovery in the stock market has sparked optimism regarding a potential resurgence in cryptocurrency prices.
The uptick in crypto-related stocks coincided with a much-needed rebound in cryptocurrency prices, as Bitcoin's value bounced back from $106.5K to approximately $110K.
Despite the positive movement, crypto traders are maintaining a degree of caution regarding further upside in the market this week. This sentiment is largely attributed to the impending options expiry today and ongoing outflows from spot Bitcoin and Ethereum Exchange-Traded Funds (ETFs).
Stock Market Recovery Signals Potential Crypto Price Rebound
In premarket trading on October 31, MicroStrategy (MSTR) and Coinbase (COIN) stock prices showed strong recovery, with MSTR rising over 6% to $269.82 and COIN climbing 4% to $342.93.
These gains follow positive third-quarter earnings reports from both companies. Other crypto-related stocks, including Robinhood Markets (HOOD), Circle Internet (the issuer of USDC), and Bullish, also saw gains exceeding 2%.
Cathie Wood's Ark Invest funds strategically increased their holdings in Robinhood stock in anticipation of upcoming earnings reports.
Bitcoin mining shares also participated in the recovery. MARA Holdings (MARA), Riot Platforms (RIOT), and CleanSpark (CLSK) experienced gains of nearly 3% in premarket trading. Simultaneously, Core Scientific (CORZ) saw its share price jump by 5.80% to $21.94.
This broader market movement is occurring as the Bitcoin price has rebounded by almost 4% following a recent crypto market downturn. At the time of writing, BTC is trading near the $110K mark.
The key question remains: will the crypto market achieve a more widespread recovery, fueled by the support from these rebounding crypto stocks?
Bitmine (BMNR) and SharpLink (SBET) Lead Gains in Ethereum Treasury Stocks
Bitmine Immersion Technologies (BMNR), recognized as the largest corporate holder of Ethereum, saw its stock trading 6% higher in premarket hours on Friday. This follows a closing price decrease of 10.47% to $44.55 on Thursday.
Bitmine Immersion holds a substantial 3.31 million ETH, valued at $13.5 billion, and has been a significant driver of the ETH price rally throughout the year.
SharpLink Gaming (SBET) stock price was also on the rise, trading more than 4% higher at $13.32 during premarket hours. SharpLink recently announced the purchase of 19,000 ETH, bringing its total holdings to $3.5 billion.
Other stocks holding significant Ethereum reserves, including BTCS, Bit Digital (BTBT), GameSquare Holdings (GAME), BTC Digital (BTCT), and BioNexus Gene Lab (BGLC), also showed positive movement in premarket trading on Friday.
Bitcoin Options Traders Target $111K Amidst Options Expiry
A substantial volume of 123,000 BTC options, with a notional value of $13.52 billion, is set to expire today on the Deribit derivatives exchange. The current put-call ratio stands at 0.70, which suggests a bullish sentiment among traders.
Furthermore, the max pain price for these options is $114,000, a level significantly higher than the current BTC price of $110,270 at the time of this report.
This data indicates a strong possibility of a Bitcoin price recovery, with crypto market participants likely adjusting their positions in response to the ongoing volatility.
However, it is important to note that the 24-hour put volume exceeded the call volume, with a put-call ratio of 1.30. This suggests that traders are increasingly purchasing put options, hedging against potential downside risks following the recent crypto market crash.
CoinGlass data reveals a recent increase in total Bitcoin futures open interest. The 24-hour BTC futures open interest has decreased by approximately 2% to $71.31 billion.
In the past four hours, BTC futures open interest on CME and Binance has seen a climb of over 0.70% and 0.68%, respectively.
Crypto analysts, including Michael van de Poppe, have indicated that for Bitcoin to sustain its recovery, it must break through the $112K resistance level. A successful breach of this level could pave the way for further price increases, potentially reaching $114K and even $117K.