Another CME Gap? Why Bitcoin Traders Should Care

2020-10-13 18:05

Bitcoin’s rise towards the $11,500 level over the weekend has created a notable price gap on the BTC CME futures chart, leaving the possibility of a pullback in early-week trading to fill the gap.

CME Gaps Point to Bitcoin Retracement

CME gaps appear when the traditional market closes, but Bitcoin continues to trade on cryptocurrency exchanges. When the market reopens on the CME either the following day or after the weekend, the CME starts trading on the market’s current prices. 

Thus, a void in a price range is created due to an imbalance in price delivery. This void can be seen where the price either opens higher or lower than the previous candle’s close.

Looking at the CME four-hour chart of Bitcoin below, traders can see a clear market gap between the close of Friday night and the opening price of Monday morning. 

BTC’s price closed at $11,098 and opened at $11,360, leaving a $262 void.

Bitcoin CME gaps have a history of eventually being filled. This means that experienced traders are actively betting on BTC to fill these gaps. On Oct. 9, a gap formed between $11,098 and $11,360, which can draw prices to trade back into this fair value price range.

Looking closely at the chart below, one can see another small Bitcoin CME gap formed on the same day. This gap is between $10,098 and $11,025.

We can hypothesize that speculative traders may use this as a trading strategy by looking to sell Bitcoin, anticipating a price correction filling up these CME gaps (fair value gaps) since the price has been unable to break the $11,500 resistance zone.

With these two pieces of information, one can assume that some speculative traders may be building a strategy around the filling of these CME gaps. In practice, this could mean selling now in expectation of a retracement to each of the above-mentioned gaps. 

Since Bitcoin has exhibited serious bullish momentum above $11,000 over recent days and is technically bullish, some traders may also attempt to buy into this current CME futures gap, as the bullish momentum could well hold in the medium term.

For experienced investors, gaps are seen as high probability setups and may present medium-term to long-term swing trades, with excellent risk to reward ratios. 

Similar to Notcoin - Blum - Airdrops In 2024

origin »

Gapcoin (GAP) на Currencies.ru

$ 0.0077536 (+0.00%)
Объем 24H $0
Изменеия 24h: 0.00 %, 7d: 0.00 %
Cегодня L: $0.0077536 - H: $0.0077536
Капитализация $111.415k Rank 99999
Доступно / Всего 14.37m GAP

traders should care bitcoin cme gap another

traders should → Результатов: 126


Grayscale’s Ethereum Trust Trading at Huge Premium, Shows YTD Returns of 679%

Data has shown that Grayscale’s Ethereum Trust is currently trading at a huge premium against ETH’s net asset value, indicating that there’s a fair amount of FOMO following it. While it’s still hard to determine whether the huge increase was caused by institutional or individual investments, traders should be careful when investing in products with...

2020-6-4 17:37


Bitcoin Crossing $9,500 Could Lead to a “Major Spike”: Analyst Explains Why

Since falling as low as $8,180 on Monday, the day of the halving, Bitcoin has mounted a strong comeback that culminated in a move to $8,900 on Wednesday morning. Although this near 10% bounce from the lows has been impressive, traders believe that BTC could undergo a “major spike” should the ever-important $9,500 level be taken as support by bulls.

2020-5-13 15:00


Фото:

Cryptocurrency Trading to Be Even More Dominated by Robots in the 2020s

Algorithms and bot-trading have taken over Wall Street and the cryptocurrency market with no sign of slowing down. Analysts say everyday traders should be terrified of the coming decade. Everyone in the cryptocurrency industry complains of bots ‘manipulating’ prices, but this will likely end up being even more severe during the 2020s.

2020-1-4 21:08


Фото:

Using a VPN May Get Israeli Crypto Traders in Trouble

Do you use a VPN? It’s a privacy-enhancing tool that everyone should be using, especially those with digital assets. Or do you happen to be older than the typical crypto trader? Both of these characteristics are part of a list of so-called ‘red flags’ that can get you in trouble with a new dragnet that […] The post Using a VPN May Get Israeli Crypto Traders in Trouble appeared first on Bitcoin News.

2020-1-2 02:15