Bitcoin Price Drops 17%, Large CME Futures Gap Filled, BTC Spot Markets Rebound

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On January 4, 2020, the price of Bitcoin fell to its lowest point of the year, falling a few minutes after 5 a.m. (EST) from the Sunday high of $ 33,800 per unit to $ 27,734. Indeed, the drop in prices filled the CME Group’s large futures void after the regulated exchange closed six consecutive gaps since ramping up. Meanwhile, some other cryptocurrencies have seen significant gains and have not fallen as much as the leading crypto asset.

Bitcoin (BTC) prices fell a total of -17.94% on Monday morning from 1:30 a.m. to 5:15 a.m. (EST). On Sunday, BTC’s daily high was $ 33,800 per unit, and the next day at 5:15 a.m., the price fell to a 2021 low of $ 27,734 per coin. Since then, the price has rebounded (15.38%) and bounced back over the $ 32,000 region. Coincidentally, the decline had also closed one of the major gaps in CME Group’s Bitcoin futures.

On Monday January 4, 2020, Bitcoin (BTC) fell to $ 27,734 before rebounding.

For example, the Bitcoin trader, known as the “Lowstrife” since 2013, announced to its 21,000 Twitter followers yesterday that CME’s sixth hole in a row had formed. “This is the sixth consecutive gap for the CME Bitcoin futures,” Lowstrife tweeted. “4 of them were large gaps (> 6%), 2 of them were small (added).

Bitcoin price drops 17%, large gap in CME futures filled, BTC spot markets recover

Gaps in trade arise because the CME Group is a regulated market that only operates Monday through Friday. If the price of Bitcoin rises or falls significantly throughout the weekend after the last price call on Friday, traders may see a gap where the futures market has stopped. News.Bitcoin.com reported a very large gap in CME Bitcoin futures, which was between $ 23,790 and $ 26,525. It was one of the largest CME Bitcoin futures gaps ever recorded. The misaligned trading discrepancies between spot prices and futures market prices caused CME to temporarily cease trading.

Futures gaps are common, and on the BTC / USD chart there are some between spot and futures market prices. The gaps can persist for a long time and are never filled. However, traders find loopholes useful as they show some bottom indicators before the actual bottom of the spot market price. The big void that news.Bitcoin.com reported last week remains vacant.

Michael Hall, co-founder and CIO of Nickel Digital, is unaffected by the recent decline, and he emphasized this morning that the long-term outlook is still pretty solid. “Because of the inelastic supply of Bitcoin, it can suffer from upward volatility in thin markets, resulting in spikes that resolve quickly but usually at higher levels, as has happened several times over the past few months, particularly in connection with Thanksgiving,” explained Hall. Nickel Digital’s managing director added:

We see no reason to change our constructive long-term view of Bitcoin and the recent wave of institutional engagement supports that. We have also always recognized that Bitcoin exposures in multi-asset portfolios should be carefully managed at low single-digit percentages.

While BTC lost a few dollars during the early morning trading sessions, some other coins recorded losses, but not nearly as low as BTC. Ethereum (ETH) is back over 14% today, trading for $ 1,044 per unit. Bitcoin Cash (BCH) rose over 5% and is currently trading above the price of $ 410. Cardano (ADA) is up over 9% as each ADA is trading at $ 0.21 per unit at the time of publication. The total market capitalization of all over 7,500 existing crypto assets is still around 841 billion US dollars on Monday.

What do you think of Bitcoin losing 17% of its price during early morning trading sessions? Let us know what you think on this matter in the comments section below.

Tags in this story

Bitcoin, Bitcoin Cash, Bitcoin Futures, Bitcoin Price, BTC / USD Chart, Cardano, CME Bitcoin Futures, CME Futures Gaps, Ethereum, Gap, Gaps, Lowstrife, Michael Hall, Nickel Digital, Spot Markets, Dealers

Photo credit: Shutterstock, Pixabay, Wiki Commons, Twitter account “Lowstrife”

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