A Look at Bitcoin’s Future Once the Big Derivative Markets Launch

A Look at Bitcoin’s Future Once the Big Derivative Markets Launch

A Look at Bitcoin’s Future Once the Big Derivative Markets Launch

$BTCUSD, $CME, $CBOE

  • Bitcoin futures trading could be choppy.
  • Bitcoin is now trading at 16,669.9941,+269.08, or +1.64%.

The world largest cryptocurrency’s parabolic rally would have triggered circuit breakers on 7 of the past 10 trading days, pausing or halting trading to ensure an orderly session, based on the big exchanges rules.

CME Group Inc. (NASDAQ:CME) stipulates a 2-min trading pause if the price of the contract rises or falls 7% from the prior day’s settlement price.

Then there would be another 2-min pause if the gap widened to 13%. No trades can occur at prices higher than 20% from the prior settlement.

Thursday Bitcoin action would have been Wild.

The 7% threshold mark was hit less than 2 hours after the session started. A few hours later 13% fell. Around 10:15a , the 20% cap was hit and held for about an hour. And the price popped above that level at least 6 other times on the rest of the day.

Cboe Global Markets Inc. (NASDAQ:CBOE) has its own rules, halting trading for 2 minus if prices rise or fall 10%, and for 5 mins at 20%. Cboe futures are set to start Sunday, while CME targets 18 December for its launch.

Here is  what the CME session would have looked like if futures contracts traced the same curve as Bitcoin.

Have a terrific weekend

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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