‘Low BTC futures volumes and low volatility’: What destinies for bitcoin price trend?

It’s been almost a year since Bitcoin futures were launched with a crazy fanfare in late 2017. However, while uptake has been admittedly lackluster so far, the future of BTC futures looks promising.The Chicago Board Options Exchange (CBOE) had announced BTC derivatives way back in early August 2017, spurring over a 2,605 percent upsurge in last year to propel BTC price to a mammoth $19.8k mark which wsa commendable.

Well, it is now stuck in the range between $6,100 and $6,850 levels over the past few weeks, we’ve got mixed bag of analysts who have been differed on the influence of the presiding of the US SEC (Securities and Exchange Commission) of Bitcoin ETFs applications.

On a broader perspective, as universally tradable hedging and speculative derivative vehicles are introduced by regulated financial institutions and the liquidity of Bitcoin considerably improved at CME and CBOE, it has been arduous for the price manipulation of Bitcoin.

Although CME reports trading volumes up 41% by end of Q3’2018, these figures merely amounts to an average 5000 contracts per day, whereas, the millions of contracts have been traded in oil, gold and interest rates etc comparatively.

On the flipside, as time progressed the high volatility owing to the underlying news and the prosperity in the emerging crypto-industry, widely tradable trading and investment vehicles render abundant leverage to large investors that are capable of reversing market trends.

Since its inception, Bitcoin has demonstrated the highly volatile scenarios. However, during the past few days, Bitcoin’s price volatility has plunged to the lowest level since June 2018 (refer above technical chart). The U.S. Securities and Exchange Commission (SEC) will most likely perceive Bitcoin’s soother price oscillations conductively.

Amid all these aspects, ultimately, the valuation of cryptocurrency industry is what needs to be predominantly considered. The same has been vouched by the many investment veterans who seemed candid to accept what caused as the obstacles in the approving the Bitcoin ETFs. 

Kara Stein, the commissioner of US SEC has also briefed recently about some basic prerequisites of the approvals of BTC ETFs, and the applicants have to adhere to these basic guidelines. She also stated that bitcoin should clearly exhibit as to how the valuations are derived, investors’ protection through substantial liquidity at any given time and ensure physical custody. Thereby, the investors are ensured with the crystal-clear guidelines for the ease of implementation of Bitcoin ETFs, only if the applicant companies strictly abide by these regulations, the SEC commissioner stated.

Hence, for now, bitcoin’s low volatility would imply that the price manipulation is waning.

With a view of arresting any bullish risks, long positions in CME BTC future contracts for December deliveries are advocated.

Currency Strength Index: FxWirePro's hourly BTC spot index is inching towards 128 levels (which is bullish), hourly USD spot index was at 68 (bullish) while articulating (at 11:48 GMT). For more details on the index, please refer below weblink:

http://www.fxwirepro.com/currencyindex