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Cryptocurrency Derivatives Series: Bitcoin Resumes Rallies Above $8,250 Ahead of BTC CME Futures Expiry, More Bullish Traction on Cards

Bearish rout in October has halted and bulls have resumed for the crypto asset markets. Market benchmark BTC has bounced back with 3.75% gains in last 3 days, while the overall crypto market cap pulled back about $15.25 bln. 

This month, the price hasn’t gone anywhere but the swings have been in sideways so far. Last month saw BTC price fall over 13.50% (previous $10,939 to $8,304). 

A probable cause of this drop was deemed as the close of a major round of CME Bitcoin futures contracts. For now, ahead of BTC CME futures expiry (on 25th), open interest has been reduced significantly (see above nutshell for volumes data). It’s likely that most of this money flowed out of Bitcoin futures and into other derivative markets but there have been considerable institutional interest that remains intact although they seemed defensive with safe-haven sentiments.

The BTC markets were able to consolidate following Friday’s drop with the $7,814 level that is acting as the strong support.

As you could refer to BTCUSD price chart of daily plotting, the stern bullish engulfing pattern candlestick has occurred at $8,236 levels and taken off rallies above 7-DMAs (daily chart), the intraday buying sentiments have also been intensified with bullish SMA & MACD crossovers and upward convergence to the price curve (refer 4H chart).

While both leading oscillators (RSI and stochastic curves) show the upward convergence to the prevailing price rallies to indicate the intensified buying momentum.

To substantiate these buying sentiments, bullish MACD crossover also signal the minor upswing is likely to prolong further.

By Niranjan Patil
  • Market Data
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