QCP Capital: Short-term implied volatility peaks on election day, and the crypto market remains bullish
ChainCatcher message, Singaporean crypto investment firm QCP Capital stated that the short-term implied volatility peaked on election day, expanding by 10 volatility points compared to the previous expiration date, with a skew towards call options rather than put options, even though Bitcoin is approximately 8% lower than its historical high. Meanwhile, the stock market presents a different picture.The S&P 500 index reached a historic high, with 20% of companies about to announce their earnings. The options market leans towards put protection, anticipating that the index may fluctuate by 1.8% on the day after the election, November 6. The correlation between the stock market and cryptocurrencies has reached a historic high of 0.83. Given its mean-reversion trend and the differences in options market positioning, this may signal the arrival of a turning point.The election creates a zero-sum game scenario for the stock market, with industry winners depending on the election results. In contrast, both U.S. presidential candidates are more supportive of cryptocurrencies than the previous administration, so any weakness in the stock market may prompt a reallocation of capital into the cryptocurrency space.