Chicago Mercantile Exchange (CME) Bitcoin futures set new records for both volume and open interest in May, a development industry experts interpret as a decidedly bullish signal for the cryptocurrency market.
In its liquidity report, the CME Group notes that May registered 223 new trading accounts, marking the strongest month for its Bitcoin futures product since its launch in December 2017.
Average daily volume reached 13,777 contracts, roughly equal to $515 million, representing a 26% increase over April and a 250% rise year-over-year. Tom Lee, head of research at Fundstrat and a well-known Bitcoin bull, interprets the data as follows (paraphrased):
This is highly optimistic, as rising Bitcoin futures volume reflects incremental institutional capital entering the market.
While the CME hits record highs for Bitcoin futures contracts, the Chicago Board Options Exchange (Cboe), the world’s largest options market, is exiting the space. The Cboe was the first U.S. exchange to launch Bitcoin futures in mid-December 2017, a move that helped push Bitcoin’s price toward the then-heady heights near $20,000. Insiders now expect the final Cboe Bitcoin futures contract to expire on June 19, 2019, and do not anticipate the exchange launching a new Bitcoin futures market as it reassesses its digital asset derivatives offering (paraphrased):
CFE will not list a Cboe Bitcoin (USD) (“XBT”) futures contract for trading in March 2019. CFE is currently evaluating how it will continue to offer derivatives on digital assets for trading. CFE does not currently intend to list additional XBT futures contracts for trading, though next steps are under consideration. XBT futures contracts currently listed will remain available for trading.
Fundstrat analyst: Now is a good time to buy Bitcoin
Fundstrat Global Advisors’ technical analyst says now could be a good time to buy Bitcoin. According to Rob Sluymer, Bitcoin’s relative strength index (RSI) is gradually signaling growing upward momentum, Bloomberg reports (paraphrased):
An additional upward attempt appears to be developing across most cryptocurrencies. Increase exposure. We expect Bitcoin to stage another rally from current levels toward the next resistance between $8,800 and $9,000.
Sluymer also highlights Litecoin’s strong performance and advises clients to use short-term pullbacks to accumulate positions.
By contrast, analyst Crypto Thies told his 28,000 Twitter followers that the 3-day RSI looks weak. He sees clear warning signs for BTC and has sold his Bitcoin for Tether to wait and see whether the market leader can close above $8,200.
Tethering here at $8200. I don’t like some of these reads I’m picking up on.
— Crypto Thies (@KingThies) June 13, 2019
According to Imkar Godbole of CoinDesk, a long-term Bitcoin indicator may soon turn bullish for the first time since late 2015.
Analyst opinions diverge significantly, making short- and long-term price direction difficult to predict with certainty. Meanwhile, initiatives that promote everyday cryptocurrency use are advancing adoption: Coinbase’s newly introduced crypto card is expected to accelerate everyday Bitcoin spending, allowing many customers — including in Germany — to buy coffee with Bitcoin in the near future.
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