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Bitcoin Rallies to $9.6K, Lifting the Chance of Hitting $10K

Bitcoin (BTC) price further climbs near $10,000, rallying by 5.68% to hit $9,600 on May 28. Following the breakout of the falling wedge pattern on Wednesday night, the most famous cryptocurrency on CoinMarketCap walked past $9,350. This was the level that traders expect to present resistance. It then made a beeline for $9,500.

The recent rally brings Bitcoin price back to the $9,600 to $9,800 zone. This is the zone in which the digital asset traded from May 13 to May 20. This heightened the possibility of a return to $10,000.

According to Cointelegraph and Skew, there are a massive amount of BTC futures contracts. This includes $184 million in CME Bitcoin Futures scheduled to expire on Friday.

Then, earlier this week, Skew tweeted, “23k Bitcoin equivalent and $10k Bitcoin options are set to expire this Friday on CME. Approx 50% of open interest for each product.”

 

Price Movement

In a Cointelegraph and Arcade Research report, Bitcoin’s price seems to tend to face increased volatility around CME BTC futures expiry date. Moreover, they found out that, after analyzing price behavior from January 2018 to August 2019, BTC’s price declined 75% of the time, before futures expire.

This indicates that traders will be closely watching where Bitcoin’s price is leading up to and after the expiry.

Contributor Marcel Pechman stated, “To better gauge the potential impact of the upcoming expiry, traders should monitor CME open interest for the May contract, Investors typically roll over position over the last few weeks.

He also said that in the case that it broke $10,000, it would add gain power for call options. But Pechman prefers to monitor for contango more than funding rates to view the curve of following futures contracts. For him, the bigger the futures premium, the more bullish giant investors are.

So, as the expiry date for $328 million in BTX derivatives arrives, traders can assume more volatility.

 

What’s Next?

Aside from the institutional and larger sized investors, who are demonstrably bullish currently, the short-term sentiment for retail investors is also changing from bearish to bullish.

The Crypto Fear and Greed Index displayed that, for the past two weeks, traders’ sentiments have shifted from fear to neutral.

Additionally, the daily chart shows that the Bitcoin price has climbed over the lower trendline of the former ascending channel. The price is experiencing some resistance at the VPVR high volume node at $9,675.

After breaking out from the falling wedge, BTC price has rallied by 8.38%. At some point, a retest of the $9,200 to $9,300 level must happen. Currently, the price is trading further into a symmetrical triangle configuration. A break of over $9,800 would push the price above the triangle trendline and the high volume VPVR node placed at the same level.

Over the following hours, the daily RSI fell from 58. The MACD looks set to converge with the signal line. Then, a rejection at $9,700 to $9,800 might increase the possibility of the price dropping under $9,500 to then return to the $9,200 to $9,300 range. This would be, in fact, near the 20-day moving average.

If traders successfully pushed the price above the pennant trendline and cleared past the $9,800 to $9,900 level, Bitcoin’s price has a higher chance of rallying at $10,300. This is where they can locate the long-term descending trendline from the all-time high on December 2017.

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