Ether Struggles Below $3,400 as $6B Options Expiry Looms
Why Has Ether Failed to Hold Above $3,400?
Ether has spent the past 40 days failing to hold above the $3,400 level, a stretch that has gradually tilted positioning toward bearish control. Despite several attempts to recover ground later than November’s sharp trade-off, each rebound stalled below that resistance zone, reinforcing trader caution ahead of year-end.
The fragileness comes as roughly $6 billion in Ether options are set to expire on Dec. 26. While call options outnumber puts by a ratio of about 2.2 to 1, the imbalance masks a deeper issue: most bullish bets were placed at prices far above current levels and now face expiry with little or no value.
At 8:00 am UTC on Friday, will determine whether bears keep the upper hand. Unless ETH trades above $3,100, options data suggests downside positioning remains better aligned with current market conditions.
Investor Takeaway
How Are Options Traders Positioned Going Into Expiry?
Deribit accounts for roughly 70% of total open interest for the Dec. 26 Ether options expiry, with the Chicago-based CME making up about 20%. Of the $4.1 billion in outstanding call options, the majority target year-end prices between $3,500 and $5,000—levels that now appear out of reach.
Less than 15% of call options were positioned at $3,000 or lower. Even later than excluding highly optimistic strikes above $5,000, fewer than a quarter of bullish positions sit below $3,200. This leaves a large share of call holders exposed to expiry losses unless a sharp rally materializes.
Some of these high-strike calls may reflect covered-call strategies rather than outright directional bets. Traders often trade calls at extreme levels such as $8,000 or $10,000 with little expectation of price reaching those zones. Still, the clustering of bullish exposure above $3,500 had been about a year-end recovery before November’s 28% drop.
On the downside, put options are concentrated between $2,200 and $2,900. If Ether trades above $2,950 on Friday, more than 60% of the $1.9 billion in put open interest will expire worthless. Even so, bears remain better placed as long as ETH stays below $3,200.
Why Has Bearish Hedging Picked Up?
Demand for downside protection has increased over the past two weeks, especially later than repeated failures to break above $3,400. Data from Deribit shows growing interest in strategies such as bear put spreads, bear call spreads, and diagonal put structures—signs that traders are preparing for continued pressure rather than a sudden breakout.
Macro-linked headlines have also weighed on sentiment. that Intel failed to advance its US-based chip manufacturing efforts, combined with news that Nvidia halted tests tied to Intel’s processes, cooled expectations around the near-term economic boost from artificial intelligence. That shift spilled into broader risk assets, including crypto.
As growth assumptions tied to AI softened, some traders moved to hedge Ether exposure rather than add leverage. The result has been heavier downside positioning at a remains range-bound and unable to regain lost momentum.
Why Is $3,100 the Level to Watch?
Options payoff models outline four broad scenarios for Friday’s expiry. If Ether settles between $2,700 and $2,900, put options gain an estimated $580 million advantage. Between $2,901 and $3,000, bears still hold a $440 million edge. A move into the $3,101 to $3,200 range would roughly balance outcomes between calls and puts. Only above $3,200 do call holders begin to view a clear advantage, with gains near $15 $3,300.
That makes $3,100 a critical inflection point. A close below $2,900 risks reinforcing bearish sentiment and pulling focus back toward December’s lows near $2,775. A move above $3,100, even without a full trend reversal, would reduce downside dominance and improve positioning for bulls into the new year.
Investor Takeaway
What Comes later than the Dec. 26 Expiry?
Once the options roll off, short-term positioning pressure will fade, but the technical picture remains unresolved. Ether still faces heavy resistance near $3,400, and repeated failures there have trained traders to trade rallies rather than chase breakouts.
For bulls, the immediate task is modest: distance price from December lows and reduce the influence of bearish hedges. For bears, holding ETH below $3,100 keeps the path open for another test of support. The expiry may not decide the trend, but it sets the tone for how traders enter the new year.
