Bybit Options Weekly Review: Aug 18–Aug 24

TL;DR

• The crypto market delivered its strongest weekly performance in two years: BTC +23.6%, ETH +31.3%, XAUT +5.8%, HYPE +44% — broad-based surge across all major assets;

• The trigger: US Treasury Secretary Bessent at least doubled the size of long-term bond buyback operations on August 19 — traders read this as a debasement signal (or at least ramped up US fiscl deficit woes); roughly $1.4 billion of short positions were liquidated in four hours;

• BTC peaked at $79,551 (three-month high), now at ~$78,200; ETH surged from ~$1,878 to a high of $2,550, now at ~$2,480; HYPE hit an all-time high of $83.4;

• Chair Warsh's speech at Jackson Hole on Aug 28 is the defining event risk of the cycle. Warsh delivers his first Jackson Hole keynote as Fed Chair  — pure two-way risk with no policy record to anchor on

• This week's strategy: ETH Short Strangle + HYPE Sell Put. Total position below 60%–70% of normal ahead of Jackson Hole

I. Weekly Market Recap

Price Action (Bybit Platform Data, August 18–24):

Every major digital asset closed sharply higher, with HYPE leading the field. The week was ignited by a single macro surprise on Wednesday that cascaded into a multi-day short squeeze — altcoins broadly outperformed BTC, and HYPE's +43.9% weekly gain, accompanied by a new all-time high, was the standout performance across the entire crypto market.

II. The Three Triggers: What Actually Drove This Rally

2.1 Treasury Doubles Bond Buybacks — The Debasement Trade

The primary catalyst: Treasury Secretary Bessent announced at least a doubling of the cap on long-end liquidity-support buyback operations. Markets read this as liquidity injection into the $30 trillion-plus Treasury market — suppressing long-term bond yields and releasing investor capital into risk assets.

This is not QE or yield curve control in the traditional sense. But the market interpreted it as a debasement signal, or at least reawakened US fiscal deficit fears.  Dollar weakens → hard alternative assets (gold, BTC) benefit. The dollar index fell below 99.475, and BTC and gold both surged simultaneously.

2.2 Trump Personally Backs CLARITY Act — Political Catalyst

Trump's White House meeting with crypto executives and personal lobbying for the CLARITY Act represents a clear policy escalation - moving from passive support to active presidential-level advocacy. This is one of the most direct political signal the crypto industry has received so far in 2026. Coinbase CEO backed the bill publicly in the same window, despite his volatile support as the bill made its way through the chambers of Congress, reinforcing regulatory optimism.

III. Technical Analysis

3.1 BTC: $67,000 Broken, Now in Range-Trading Mode at $75,000–$82,500

BTC broke above $67,000 and its 200-day simple moving average (SMA) for the first time since early-November, continuing on to $79,500 before pulling back. The price has now returned to the May 2026 historical trading zone — corresponding to the head region of the prior head-and-shoulders pattern. This $75,000–$82,500 zone has clear resistance above and clear support below: range-trading is the dominant paradigm.

READ MORE:

• published Fri, Aug 21: Here's why Gold and Bitcoin are soaring! How high could XAUUSD and BTC go?

• Published Thur, Aug 20: Watch these 4 factors to see if BTC can move even higher.

3.2 ETH: Double Bottom Complete, New Range $2,380–$2,650

The double-bottom structure that we tracked for months has fully delivered — the original measured target was $2,150–$2,200; this rally reached $2,550, exceeding the target by ~$350. The market has now transitioned into a new trading range of $2,380–$2,650, with price expected to oscillate within this zone.

The old "double bottom → neckline → measured target" playbook is complete. The operating logic has shifted from "waiting for the breakout" to "harvesting time value within the range."

3.3 HYPE: All-Time High — But Watch the 4H Divergence

This week HYPE posted the strongest weekly gain among major assets at +42.9%, and on August 23 touched $83.4 — a new all-time high.

This breakout was not purely sentiment-driven. It reflects both fundamental and technical validation operating simultaneously:

On the fundamental side: Hyperliquid is currently the largest decentralized derivatives protocol by volume and one of the fastest-growing by user acquisition. When the Treasury debasement trade ignited risk appetite this week, on-chain derivatives demand surged — Hyperliquid was a direct beneficiary of the explosive growth in decentralized exchange activity. HYPE also features a protocol revenue buyback-and-burn mechanism, meaning its fundamental support strengthens as trading volume expands. This distinguishes it meaningfully from purely narrative-driven altcoins.

On the technical side: The price broke above prior highs while forming a textbook bullish flag breakout pattern, accompanied by volume expansion — the defining characteristic of a technically valid breakout rather than an emotion-driven spike. Breaking to a new all-time high means there is no historical overhead supply to create structural resistance, and the flag's measured target points toward $90.

The risk to watch: The 4-hour timeframe shows a bearish RSI divergence — an objective technical signal that cannot be ignored. Two paths from here: ① a pullback/consolidation phase; ② a larger-volume surge that absorbs the divergence. We make no directional call, but this structure means the path to $90 may involve a digestion period before the next leg.

3.4 XAUT: New Range $4,500–$4,760

The market structure has changed materially. Last week's breakout above the $4,330–$4,400 key zone, with price sustaining above $4,600, has opened a new price territory. The new zone is dense with resistance, forming a new trading range of $4,500–$4,760 with both support and pressure present within it. The slow uptrend remains intact, but the path higher will continue to encounter multiple layers of resistance.

IV.Outlook for This Week (August 25–31)

This week's key calendar:

⚠️ Jackson Hole critical risk framing:

Core PCE lands two days before Warsh speaks — expected to accelerate (+0.3% MoM). A hot PCE print followed by a hawkish Warsh speech would be the single largest negative catalyst combination of the entire cycle.

Three scenarios:

V. This Week's Strategy: 

Strategy framework has shifted. The market has transitioned from a single-direction move into high-altitude range trading. ETH is consolidating within $2,380–$2,650; HYPE is digesting its breakout with a 4H divergence overhead. When implied vol is elevated and price is range-bound, selling premium is the optimal structure — collect time decay while price oscillates within defined ranges.

5.1 HYPE 

The logic: HYPE is entering a new consolidation range after its all-time high breakout. The 4H divergence suggests digestion is likely before any continuation toward $90. Selling a $73-$74 Put (below the $75.87 support) collects premium while positioning for a buy-the-dip entry at a level that only gets hit on a significant pullback — well below the current consolidation range.

⚠️ Risk management:

• HYPE is a high-volatility altcoin options product — tail risk is real and significant

• Put leg stop: HYPE breaks below $70 on a confirmed close → buy back the Put leg immediately

• Warsh hawkish at Jackson Hole → Close all HYPE positions immediately; no averaging

5.2 ETH 

The logic: ETH's double-bottom structure has fully played out; the market has entered a new $2,380–$2,650 oscillation range. Selling a strangle with strikes outside this range — Put at $2,300–$2,325 (below range floor), Call at $2,650–$2,700 (above range ceiling) — provides a 3%–10% safety buffer on both sides while DVOL at 59% ensures the premium is worth collecting.

⚠️ Risk management:

• Put leg stop: ETH daily close below $2,240 (W-bottom target, now support) → buy back Put leg immediately

• Call leg stop: ETH breaks above $2,700 on a sustained close → buy back Call leg

• Ahead of Jackson Hole (Aug 28 AM ET): Reduce both legs to 60% of their already-conservative sizing

• Warsh explicitly hawkish → Close all ETH positions immediately; do not wait for expiry

5.3 Target Selection Logic and Overall Risk Framework

Why HYPE and ETH over other assets:

Overall position risk rules (both positions combined):

1. Total exposure: no more than 10% of account NAV 

2. Each individual position: 60%–70% of normal single-position sizing

3. Before Warsh speaks (Aug 28 AM ET): reduce position to 60% of sizing or less

4. After Warsh's speech resolves direction: reassess whether to restore sizing or exit entirely

VI. Weekly Summary:

• All major crypto assets experienced the strongest week in two years. Three simultaneous catalysts: Treasury debasement trade, Trump's CLARITY Act push, SEC regulatory framework announcement. $3.26B in liquidations amplified every move upward.

• HYPE hit a new all-time high — fundamental and technical validation converging. Hyperliquid's protocol revenue mechanics and leadership in decentralized derivatives volume provided the fundamental foundation; the bullish flag breakout with volume provided the technical confirmation. The 4H divergence overhead means the path to the $90 measured target may involve digestion first.

• Jackson Hole (August 28) is the most important single event risk of the cycle. Warsh's first Jackson Hole speech as Fed Chair is pure two-way risk. Core PCE is forecast to accelerate two days before he speaks — a potential double hawkish catalyst.

• This week: HYPE Sell Put + ETH Short Strangle, both weekly options. Harvest elevated DVOL premium. HYPE APY ~60%–85%; ETH APY ~50%–75%. All positions capped at 60%–70% of normal sizing — reduce further ahead of Warsh's speech, then reassess direction once the keynote resolves.