QCP Capital: Short-term implied volatility peaks on election day expiration, crypto market still leans bullish

Odaily Odaily QCP Capital published an article stating that short-term implied volatility peaked at the expiration of the election day, expanding by 10 volatility points from the previous expiration date, and the skewness favored call options rather than put options, even though Bitcoin was about 8% below its all-time high. Meanwhile, the stock market presented a different picture. The S&P 500 hit a record high, with 20% of companies about to release earnings reports. The options market favors put protection, and it is expected that the index may fluctuate by 1.8% on November 6, the day after the election. The correlation between the stock market and cryptocurrencies has reached an all-time high of 0.83. Given its mean-reversion trend and the difference in options market positioning, this may herald the arrival of a turning point. The election has created a zero-sum game scenario for the stock market, and industry winners will depend on the election results. In contrast, both US presidential candidates are more supportive of cryptocurrencies than the previous administration, so any weakness in the stock market may prompt capital to be reallocated to the cryptocurrency field.