Bitcoin (BTC) volatility reached new levels during the weekend, causing waves of unsteady price moves. The CME market for Bitcoin also saw significant activity around the same time, resulting in a CME gap between 84,650 and 93,300 USD. Many crypto specialists have analyzed the price movements, predicting an impending drop which will propel Bitcoin to lower levels in the coming days.
What is a CME Gap?
A CME gap refers to the price of Bitcoin undergoing a major change while the bitcoin CME exchange is closed for the weekend. Since the CME operates on weekdays, considerable price fluctuations occurring on Monday create a gap between the last price traded on Friday and Monday opening price. These gaps tend to act like ‘price magnets’, meaning that more often than not, Bitcoin will attempt to return to such levels to fill the gap.
Bitcoin’s Volatile Weekend
Bitcoin’s price reached a low of $78,258 on February 28, but it recovered quickly after dipping. Some analysts report BTC filled two CME gaps, one at $78,000 to $80,700 and another at $92,800 to $94,000. Regardless, this movement created a new record CME gap of $84,650 and $93,300 unveiling new prices.
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What This Means for Bitcoin
Rekt Capital, a crypto analyst, noted reaching an extreme of $78,258 does not mean Bitcoin is unable to revisit those numbers in the future. As he explains further, if BTC’s price goes to $84,650, it indicates the price is still lower than the last weak bullish low, implying the price would be higher than previous lows suggesting an upwards price trend.
Another crypto analyst, Merlijn The Trader, predicts volatility measures will go “parabolic” for Bitcoin in the coming days. The spree has already caused over $900 million in liquidations in a single day meaning traders lost funds due to price changes.
More Downside Ahead?
Currently trading around $90,000, some analysts are still concerned that Bitcoin might be heading for further dips. Crypto analyst Ali Martinez has suggested that Bitcoin might fall to $74,700 before propelling forward. This correlation is drawn from previous activity where Bitcoin tends to rise aggressively from long-term support levels.
Factors Affecting Bitcoin’s Price
The observed price decline in Bitcoin can be linked to the following factors:
- Absence Of Novel Market News: Coinbase analysts highlighted the fact that Bitcoin’s price is stagnating, and even on hype there are no positive activities to initiate an increase. Without fresh novel initiatives, BTC is struggling to stay at least above the $90,000 mark.
- Bybit Hack: The recent attack on Bybit’s security systems has further worsened the already fragile investor sentiment towards Bitcoin.
- Geopolitical Risk Factors: The current state of the economy and various world events happening is not only impacting society but the currency as well.
Good News for Bitcoin
Irrespective of these factors, there is something good to say. There is growing activity on crypto spot exchange-traded funds with more constructions seeing some favorable investment inflows on the bitcoins market and lesser speculatory traders. More BTC spot ETFs indicates more long term holders which helps bolster Bitcoin’s price in the longer term.
Conclusion
The CME gap on the weekend volatility for Bitcoin has set a new record at $85,000, which is concerning for a further price drop. Some analysts predict a Bitcoin revisit to lower price levels while others predict the dip is merely temporary before another surge. As always, traders should be ready for more price swings. Bitcoin is, and always will be, highly unpredictable.
Also read: Hackers Exploit Fake GitHub Repositories in “GitVenom” Scam to Steal Crypto: Kaspersky Warns
