The CME Bitcoin Futures market is worryingly losing appeal to institutional investors as the number of long contracts experienced a 300%+ plummet in open interest recording the lowest weekly drop four months. The number of open interest long contracts on CME is now at October lows despite the 200%+ increase last month.
According to data collected on Skew, a crypto data analytics firm, the open interest in long contracts by institutional investors saw the largest week on week drop in three months. Having recorded a high of 805 BTC futures at the start of September, the number plummeted gradually to -290 long contract of BTC on October 1st.
November wipes out 3 months gain in CME BTC Futures
During the month of October, the open interest in long contracts exponentially increased as Bitcoin’s price grew by 42% in a day to test the $10,000 resistance level. As the bearish sentiments faded and bulls took over the market, the CME Bitcoin Futures Net Open Interest grew from 195 longs to 660 longs in three weeks representing nearly 240% increase during the period.
A week later, the longs grew to 870 open long contracts on BTC cash-settled futures closing at its highest point in the four preceding months. However, a crash in Bitcoin’s price towards the lower $8,500 region at the start of the weekend has wiped off most of the institutional interest in BTC futures witnessing a mammoth wipeout of 675 long contracts.
While everyone celebrates Bakkt now trading almost 1000 bitcoin a day, CME volumes are back down to 2018 levels.
— Alex Krüger (@krugermacro) November 8, 2019
Alex Kruger, Colombian economist, and crypto analyst warned on the possibility of an upcoming bearish run on the price of Bitcoin. Bakkt futures have been on the rise in the past few weeks witnessing all-time highs (ATH) during the week crossing the $15 million USD mark. However, CME Futures is now at 2018 levels which is a bearish signal for the pioneer cryptocurrency.
Today we set a new daily record of 1,756 Bakkt Bitcoin Futures contracts traded
— Bakkt (@Bakkt) November 8, 2019
Bitcoin is headed to all-time highs
Despite the slow growth in Bitcoin’s cash-settled futures, the crypto is still on road to breaking all-time highs. The current reversal in price towards the $8,500 support levels may act as a catalyst to push the price above $10,000 levels, our trading expert, John Isige wrote on Nov. 8.
With the halving fast approaching, Jason A. Williams, Co-founder, and Partner at Morgan Creek Digital believes the price of BTC is set to explode. He tweeted,
Block Halving ETA: 177 days, 1 hour, 3 minutes
Date ETA: May 5th, 2020
Next year’s event will reduce the amount of new Bitcoin in circulation up to $63 million per week at current prices.
2016 Halving Price – $650.63
Nov 10, 2019 Price – $8835.20
— Jason A. Williams ? (@JWilliamsFstmed) November 10, 2019