Bitcoin endured a stormy CME monthly close, falling $400 and bouncing back up $520 inside the final hour of the monthly window, before settling down more or less where it had been. Having started the weekend at $10,235, BTC dropped as low as $9,115 during the crazy trading session, signaling a lack of liquidity in the market as much as CME price manipulation. The move leaves BTC on something of a knife edge with little to indicate which direction is next.
Tail Wags the Dog
The activity across the monthly CME close, which fell three days before the traditional monthly close, is indicative of the control that the futures market has over the Bitcoin market at the moment. With liquidity running low, partly down to the mass exodus from BitMEX thanks to their ongoing CFTC investigation, the CME futures have a clear playing field…and it’s clear they’re enjoying themselves. The timing of the dump to the low $9,000s didn’t go unnoticed, with the futures market now appearing to some to dictate physical prices rather than the other way round.
#CME CASH #Futures have STARTED GUIDING #Bitcoin price at Physical exchanges. CME opens 5 pm CST Sunday
This is just the START. Anyone remembers CME’s Leo in 2017?
Here is Futures post I wrote in Jan-2018https://t.co/gFAcCjTZyd pic.twitter.com/2Jzid9HZRS
— Bitcoin, Gold, Silver & Geopolitics (@Super_Crypto) July 29, 2019
Despite the recovery, the Crypto Fear and Greed Index sat at a surprisingly low 19 going into the start of the week, which is skirting around the yearly lows. This indicates how bearish the market is in general, evidenced by numerous predictions across crypto Twitter that a drop to the $8,000s and perhaps below is on the cards.
— Mac ❄️? (@MacnBTC) July 27, 2019
I wonder how many times your average cocky influencer changed their bias and narrative on bitcoin in the past two months.
I don’t delete tweets and I don’t rant when I get things wrong. pic.twitter.com/C5V1SUxDx8
— Livercoin (@livercoin) July 29, 2019
Alts Waiting Their Turn…If It Comes
Alts reacted in a similar pattern to BTC, spiking down and back up again to settle roughly where they were. Their lack of activity has prompted much discussion within the community as to whether another alt season will happen at all, and if it does what it will look like compared to 2017. Certainly it seems Bitcoin’s instability is still preventing alts from making much of a move, with only strong news catalysts providing any significant upside, and even then it doesn’t seem to last. Only coins like REN, which has been on a continued uptrend since April, are making any significant headway, and the consensus seems to be that we won’t really know what we’re in for unless BTC bottoms out and undergoes a months-long accumulation process. Only when that happens will we truly know what alts are made of.