After the rise in volume (April 20th) responsible for breaking the downtrend that had been in place since late December, Bitcoin has consolidated nicely above the resistance support. The consolidation has taken place around the $9k USD levels without a retest of the downtrend. Volume seems quite healthy, although it has been descending on a daily basis since Bitcoin bounced off some vital resistance levels the week.
Usually, if you take a look at the history of Bitcoin charts, it has seen lower volume on the weekends and from observation, it is trending that way this week as well. This often results large price swings, for it is easier to move the price of Bitcoin when less money is flowing through the markets. The $10k price is expected by investors as it a major psychological resistance level that may be in play after this weekend.
Bitcoin futures have been in play since December and have been speculated to be a major factor affecting Bitcoin price. Indeed, the correlation between the closing date each month of futures contracts and the following price action from $BTC is really noticeable. One could even state that institutional traders are using futures contracts to manipulate prices to accumulate Bitcoin at their desired targets - we did state that in December, and we have been of the same opinion now.
The introduction of futures seems to have brought much more exposure to cryptocurrency from institutions and retail traders. Two days ago, Bitcoin futures saw a record day in volume, with over 11,000 contracts being traded at the Chicago Mercantile Exchange (CME) and over 19,000 contracts at the Chicago Board of Exchange (CBOE). Bitcoin futures have increased their trading volume month over month since their inception.
Generally, this may be seen as a positive trend because the nature of growing asset classes is directly correlated to its acceptance by the traditional financial trading community. Once this community has more opportunities and options to trade off the volatility of crypto, it will spark interest throughout their ranks which will eventually spread the message to new money entering the markets. All in all, the more investment vehicles tied to cryptocurrency, the better because it will provide proliferation of the number of people who will hear about Bitcoin and Cryptocurrency in their everyday lives. Just like in December when new money flooded in, with tons on FOMO boys trying to board the ship. They got flushed out 2 months later and it will happen to them again. But that’s for something completely different.
Bitcoin is here to stay, so is the crypto. Blockchain will even bigger. That’s our general long-term sentiment.
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