Bitcoin CME Gap: A Potential Correction?
The recent surge in Bitcoin price has led to speculation about the possibility of a correction, with analysts pointing out a significant CME gap at $39,700 that needs to be filled. According to popular analyst Willy Woo, 28 out of 30 gaps on CME daily candles have already been filled, suggesting that this remaining gap may also need to be closed before another rally can occur.
While some dismiss the significance of the CME Bitcoin narrative due to recent positive sentiment and market rally, it’s worth noting that the Fear and Greed Index is currently at extreme greed. Additionally, the open interest for CME Bitcoin futures stands at $5 billion, indicating substantial institutional involvement in the market.
Potential Risk for BTC Price
If the Bitcoin CME gap at $39,700 is indeed filled, it could result in a potential 10% drop in BTC price. However, this could present an opportunity for investors to buy the dip before another rally ensues. With anticipation surrounding a spot Bitcoin ETF and a dovish stance from the U.S. Federal Reserve, many traders remain bullish on Bitcoin’s long-term prospects.
Currently trading at around $43,506, Bitcoin has experienced some pullback from its recent high of $44,408. It’s important to note that trading volume has decreased by 32% in the last 24 hours, suggesting a decline in trader interest.
Hot Take: Bitcoin Price Correction Expected Before Next Rally
While Bitcoin continues to garner attention and reach new highs, the presence of an unfilled CME gap at $39,700 raises the possibility of a price correction. Analysts emphasize the importance of filling this gap before the next rally can occur. With institutional involvement and positive sentiment driving the market, investors should be prepared for potential volatility in BTC price. Keep an eye on market indicators such as open interest and trading volume to gauge investor sentiment and make informed decisions about your cryptocurrency investments.
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