October 27 Weekly Market Report - Fluctuation Stabilizes Before Federal Reserve Meeting, Market Risk Appetite Recovers

Weekly Report Date: October 27, 2025

Important Reminder: Opinions and information are for reference only and do not constitute investment advice for anyone.

Strategy Recommendation: BTC Bullish Calendar Spread

Begin Options Trading:

Gate Options Underlying Price Review

The 7-day average trading volume across the entire market has continued to decline rapidly for two consecutive weeks.

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Bitcoin (BTC) Options Market Summary

Over the past week (October 21 – October 27), the overall crypto market rebounded driven by easing macro policy expectations and risk sentiment recovery. The latest September CPI report showed a year-over-year increase of 3.0% (below the expected 3.1%), with core inflation rising only 0.2% month-over-month, indicating continued easing of inflation pressures. The forecasted probability of interest rate cuts is now 96.7%, further fueling expectations of rate reductions, and the market generally believes the financial environment may become more accommodative in the future. Meanwhile, signs of de-escalation in trade tensions among major economies have emerged, reducing safe-haven demand and leading to a rebound in risk assets.

Regarding BTC spot performance: prices have maintained oscillations within the $108,000 – $115,000 range over the past week, showing an upward trend but without a strong breakout, remaining in a consolidation phase.

In the options market: the implied volatility (IV) for BTC’s latest public data is 42.07%, a significant decline from last week, indicating market sentiment has stabilized and expectations for future price volatility are converging.

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The implied volatility (IV) for near-term and longer-term options has returned to more rational spreads, suggesting the market’s short-term outlook for volatility is becoming more rational.

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In block trading: the largest proportion this week, at 24.7%, was a bullish calendar spread, reflecting investor positioning in a low-cost, long-term bullish strategy. The week’s largest block trade involved buying BTC-270326-180000-C and selling BTC-261225-140000-C bullish calendar spreads.

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The 25-Delta Skew of BTC options remains predominantly negative this week, indicating persistent defensive sentiment against downward risks. The skew term structure has flattened, reflecting increased hedging demand for short-term rebounds. Additionally, implied volatility for put options was once about 13 vols higher than for call options but has gradually converged to approximately 2 vols, suggesting a significant easing of bearish sentiment.

Overall, long-term BTC options still exhibit a bearish bias, with institutional investors favoring continued risk hedging rather than betting on substantial price increases, maintaining a cautious outlook on medium- and long-term trends.

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The realized volatility (RV) of Bitcoin (BTC) has fallen to about 40, with the Volatility Risk Premium (VRP = IV – RV) narrowing to -2.46 vols, a notable normalization from the panic period last week at -7.38 vols. Currently, the overall implied volatility (IV) remains below the actual realized volatility (RV), indicating a negative VRP structure. Under this scenario, the market is pricing in lower future volatility, making strategies that benefit from rising volatility (Long Vol) attractive, such as Long Straddle, Long Calendar Spread, or other bullish Vega strategies.

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Ethereum (ETH) Options Market Summary

ETH prices have oscillated within the $3,600 – $4,300 range this week, forming a trading range pattern. Early in the week, sustained selling pressure repeatedly tested the lower boundary at around $3,600 but found support each time, indicating short-term buying resilience. Later, driven by improved macro risk sentiment, ETH surged toward the end of the week, approaching the $4,300 level. However, significant selling pressure remains near the upper boundary of $4,300 – $4,350, and whether it can break through effectively depends on increased volume and further market momentum.

Overall, ETH is in a phase of “oscillation + tentative rebound,” with key support at $3,600 and resistance around $4,300 – $4,350.

In the options market: the latest public data shows implied volatility (IV) at approximately 69.08%, a sharp decline from previous levels, reflecting stabilized market sentiment and reduced expectations for large future fluctuations.

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The IV difference between near-term and longer-term options has returned to more rational levels, indicating a more rational short-term outlook on volatility.

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In block trading: the largest proportion this week, at 51.5%, was buying call options, indicating a bullish positioning among investors. The largest single trade involved buying 10,000 ETH-311025-4200-C call options.

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The 25-Delta Skew of ETH options showed a marked steepening in midweek, reflecting increased hedging demand against short-term downside risks; by the weekend, it gradually flattened, indicating market sentiment was softening as rebound expectations increased. During this period, implied volatility for put options was once about 15 vols higher than for call options but later converged to near zero, indicating a significant easing of bearish sentiment.

From the term structure perspective: ETH’s longer-dated options remain relatively optimistic, with 2026 expiry contracts still showing a bullish premium structure, indicating that medium- and long-term market expectations remain upward.

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Ethereum (ETH) realized volatility has fallen to about 58, while the VRP (IV – RV) has risen to 9.72 vols, reflecting a recent increase in risk appetite and short-term implied volatility. Currently, implied volatility (IV) exceeds realized volatility (RV), indicating the market is pricing in higher future volatility, making volatility-selling strategies relatively advantageous, such as selling options structures to generate Theta or implementing Vega short positions.

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Policy Events Overview and Market Impact

1. US-China Trade Tensions Easing Boosts Market Sentiment

As of October 26, 2025, the US-China-Malaysia trade negotiations eased concerns over trade friction, boosting risk appetite and causing Bitcoin to rebound briefly above $115,000 during the week.

2. US September Consumer Price Index (CPI)

The US September CPI was slightly below expectations, reinforcing market expectations of a 25 basis point rate cut by the Federal Reserve in October, which supported a short-term rebound in Bitcoin as funds flowed back into risk assets.

3. Federal Reserve October Meeting

The Federal Reserve’s meeting scheduled for October 28–29 is expected to cut interest rates by 25 basis points. If confirmed, this would boost liquidity and risk appetite, providing short-term positive momentum for the crypto market.