How Bitcoin price fares in the near term seem to currently be up in the air and somewhat dependent on legacy markets
Bitcoin price could soon approach the key CME futures spread at $ 9,600, formed as BTC rallied from $ 9,000 in late July and early August.
CME futures are closed over the weekend, although Bitcoin spot markets are still trading. This forms a natural gap in CME’s price action, much of which gets filled within a week after opening.
Bitcoin fell at the same time as other financial markets
At press time, Bitcoin is down nearly 5% over the past 24 hours, trading around $ 10,433. At the present time, selling pressure is still pouring on Bitcoin, but it is unclear why.
Bitcoin price tapped over $ 11,000 one last time before a deadly drop began later Saturday night and into Sunday. The drop extended deeper into the weekday trading week, with a fall to under $ 10,400 starting Monday morning. It was just Bitcoin, Ethereum, Ripple, and even top DeFi tokens tanked in the selloff. Blockchain data shows that miners were partly responsible for driving prices down, however, the drop is really due to the dollar.
Alongside Bitcoin’s steep breakdown, stocks fell on Monday as fears about the potential worsening of the coronavirus pandemic, as well as uncertainty on further U.S. fiscal stimulus, rattled traders.
According to CNBC, the Dow Jones Industrial Average dropped 509.72 points, or 1.8%, to close at 27,147.70. The S&P 500 lost 1.2% to 3,281.06. The Nasdaq Composite closed just 0.1% lower at 10,778.80 after a late-day surge in tech stocks. At one point, the Dow had dropped more than 900 points. The S&P 500 fell as much as 2.7%.
Meanwhile, the U.S. dollar index, which tracks the greenback against a basket of its peers, was last at 93.561 after earlier surging from levels below 93.3. The Japanese yen traded at 104.74 per dollar after weakening from levels below 104.4 against the greenback yesterday. The Australian dollar was at $ 0.7225 following yesterday’s drop from levels above $ 0.73.
A selloff across global equity markets, tied partly to worries over the rise in COVID-19 cases and the potential for the renewal of restrictions on activity, as well as uncertainty over a fresh round of government relief, added to the negative tone. And this shows that Bitcoin’s decline is not entirely its fault. Clearly even gold is down, with the gold futures dropped by nearly 3% on Monday.
Craig Erlam, senior market analyst at Oanda, stated:
“Gold is once again not providing shelter in these hazardous times.”
Bitcoin price will soon fill up the CME gap
BItcoin will soon fill the CME void, and crypto analyst MacNBTC is watching the recent price action. He noted how the cryptocurrency lost the support of the key support at $ 10,900, likely to trigger a move to $ 10,200.
“$ BTC: Looks ready to finally go fill that CME gap. Did quite tap the $ 11,200, 0.65 region I talked about.”
The majority of investors believe that the gap will also be filled. Commentator and programmer Ivan on Tech recently asked more than 100,000 of its followers if they think Bitcoin will fill the CME void; about 60% of the respondents said they think Bitcoin will do so in the future.
We might go and fill that juicy CME gap at $9600
What do you think?
— Ivan on Tech (@IvanOnTech) September 21, 2020
However, not all analysts think the gap will be filled.
Willy Woo, a renowned chain analyst, recently commented on the chart below:
“I’m still cautious of another short term dump to fill the gap but so far it’s looking like it’s been front-run for liquidity which is strongly bullish if we break resistance here. There’s a lot of bids in the spot order books wanting to snap up the gap in the mid-high 9000s.”
Woo has been making extremely accurate predictions in recent weeks, in late August, calling Bitcoin’s decline to as high as $ 9,000 and last week’s rally from $ 10,000 to $ 11,200.
He still believes Bitcoin’s mid-term trend is positive:
“Overall, I’m not expecting any mega dump, some chance of smaller whipsaws in the short timeframes, resistance is teetering. Not a bad time to get in if you’re a spot investor, given the longer-range macro. There’s plenty of buy support below 10k, this is a buy the dip scenario.”
However, how Bitcoin will increase in price in the near term appears to be rising in price and is somewhat dependent on legacy markets.
- The Cryptocurrency Market Cap Has Lost $8 Billion Meanwhile, Bitcoin Price Remains Relatively Calm And Is Just Beneath $ 11.000
- FED’s Press Conference About The Next Stimulus Package Can Leave Bitcoin Price More Bullish In The Short-Term