Bitcoin is incredibly bullish, now trading only $2,000 away from setting a new all-time high. The momentum has caused the crypto community to erupt in chatter regarding prices of $100,000 or more in just a year’s time.
But before this happens, one ultra-bearish trader believes there’s a chance the cryptocurrency could retest its bear market bottom, and potentially fill all remaining gaps left on CME BTC Futures price charts. Is this trader in disbelief, or is there validity to their theory?
Bearish On Bitcoin: One Crypto Traders Expects A Full Retrace
With Bitcoin only a couple thousand dollars away from revisiting its former all-time high, the crypto market is exuberant once again. But this time, they have a reason to be.
The cryptocurrency could be on the cusp of a new bull market so investors are rightfully moving BTC off exchanges and into cold storage for safekeeping. The total BTC on exchanges is at the lowest point since the last bull run.
Related Reading | Bitcoin Captures $17,000, Bears And Bulls Alike In Disbelief
It is hard to imagine anything at this point standing in the way of a repeat of 2017, if not something far more spectacular. Projections from even experts and some of the world’s best investors all expect prices of $100,000 or more someday.
And while most investors and analysts believe that Bitcoin is well on its way and that the “train has left the station,” one bearish trader expects all remaining CME Futures gaps to be filled, before the cryptocurrency moves on to a new all-time high.
Two CME Bitcoin Futures gaps exist that may or may not ever be filled | Souce: CME BTC1 on TradingView.com
Why Are CME BTC Futures Gaps So Important?
Bearish crypto analyst Joshnomics has shared a chart on Twitter, reminding the crypto community about the two CME Futures gaps left below current levels.
The nearest of the two gaps leftover from the bear market resides at roughly $11,250. The second one is much lower, right around where Bitcoin bottomed in 2018, and lower than the Black Thursday collapse earlier this year.
The latter was caused by the world learning of the pandemic and falling into a panic. The former was due to natural market dynamics. What could cause such a dramatic dive this time around? And why are CME Futures gaps such a big deal?
In speculative assets, when official trading desks like the Chicago Merchantile Exchange close up on Fridays, the chart stops tracking price action, while the rest of the world keeps on trading Bitcoin.
When Monday through Friday trading sessions resume, any extreme weekend movements leave a gap behind that more often than not, gets filled. Data shows that the gaps usually get filled within the first week after they appear.
In rare cases, like the gap left behind around Bitcoin’s bottom, it has taken almost two years and the gap still is there, acting as nothing more than a frightening possibility that unbiased traders like the one mentioned cannot rule out.
Featured image from Deposit Photos, Charts from TradingView.com