A massive drop in open interest on the CME and Bakkt Bitcoin futures contracts indicates short-covering has fueled BTC's latest rally, likely egged on by the expiry of Bakkt's December contract.
On Tuesday, open interest rocketed more than 1,000 percent on the cash-settled CME contract for December, the day after Bakkt hit an all-time-high for open interest on its physically-settled December contract, according to analytics outfit Skew Trading.
The next day, open interest fell off a cliff on Bakkt and CME, dropping by 39% and 25% respectively.
Coinciding with Bitcoin's sharp thousand-dollar rally to the upside, the sudden drop in open interest suggests both CME and Bakkt traders have been exiting a large number of short positions and driving BTC up.
Traded contracts: 6601🚀 All time high: 6601💰 Open interest: $3.98 million.
Knowing bots, we recommend this smart trading bot: https://t.
The timing of the rally is hardly surprising - coming just hours before the expiry of the Bakkt December contract.
As previously reported by CryptoSlate, Bakkt's push to offer cash-settled futures has called into question whether institutional traders are interested in gaining exposure to Bitcoin via physically-settled futures contracts.
The latest short cover suggests Bakkt's contracts are functioning mostly as a vehicle for short-term speculation.
Many traders appear to have rolled over their contracts to January on both Bakkt and CME which could translate to bullish sentiment for Bitcoin's longer-term outlook.
Futures data suggests latest Bitcoin rally is just short-covering, most Bakkt contracts aren't being settled
gepubliceerd op Dec 19, 2019
by Cryptoslate | gepubliceerd op Coinage
Coinage
Vermeld in dit artikel
Recent nieuws
Alles zien
Blockchain Bites: Bitcoin's Run, Uniswap's Hemorrhaging Value, Anchorage's Banking Bid
Bitcoin is nearing all-time highs in price and market cap last set three years ago.
Japan's megabanks to lead experiment with digital yen
We have, in order, Cheese Bank with a $3.3 million theft, Akropolis with its $2 million loss, Value DeFi with a whopping $6 million exploit and finally Origin Protocol's loss of $7 million.
Number of new Bitcoin addresses spikes amid growing FOMO
Japan's three largest banks, as part of a group of 30 private sector actors, are set to collaborate on an experiment with a digital yen.
Not just Wall Street: Quant trader explains why Bitcoin price is going up
Sam Trabucco, a quantitative trader at Alameda Research, believes four general factors are pushing up the price of Bitcoin.