Future Bitcoin CME: the net position of institutional investors remains short; this is the key to 2020

Future Bitcoin CME: the net position of institutional investors remains short; this is the key to 2020

The TOC report for Bitcoin future contract of CME allows to take stock of the positions opened by the institutional traders and the private traders.

Key technical factors of the article:

  • Bitcoin future contract : the Commitment of traders (COT) report of the CFTC / CME allows to know the open position of professional and private traders on the future Bitcoin contract. So that the BTC is on an uptrend again, institutional investors must be buying.
  • VSBitcoin bear (BTC / USD) : The market is still clinging to the upward chartist trend line in place since the start of 2019.

Trading positions of institutions and individuals on the CME Bitcoin future contract (COT report)

Before starting this technical post, I wish you all a happy new year 2020 and thank you for regularly reading my analyzes sure Cryptonaute.

On the financial markets, it must be borne in mind that an asset evolves in an uptrend over a long period if and only if the institutional traders (those of hedge funds and banks) are purchase because they are the ones who hold the capital.

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Within the different categories of traders, these are the “strong hands”, an expression which is opposed to the “weak hands”, that is to say private traders individuals who do not have millions of dollars of capital traded daily on the BTC contract of the Chicago Mercantile Exchange (CME) for example.

The report Commitment Of Traders (COT) of the CFTC / CME allows to obtain each Friday the inventory of the open position of several categories of traders on the future Bitcoin contract.

On the graph above, the dotted line represents zero (below, the open position is net sell, above net buy) and you can observe that during the increase between $ 3,100 and $ 13,900, the position open to pro traders became less and less negative before going net buyer.

In the downside since last summer, the strong hands have been growing for sale, so they clearly “make” the market.

For 3 weeks, the bitcoin price rebounded twice on the support formed at $ 6,500 and still clings to the chartist trend line in place since the beginning of 2019.

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In the first rebound of $ 6,500, the open short position of institutional investors was reduced, so there were professional traders to buy in this first rebound. But with the second rebound and in the current stabilization, this rebound from the open position of the pros towards positive territory has not been confirmed.

Capital Invested by Bank and Hedge Fund Traders is the Only Way to Boost the BTC. It is therefore advisable to combine the technical approach with the weekly evolution of the open position of these traders. If they are the ones who make the (possible) next rebounds, then this will be very positive.

The TOC report is updated every Friday so I will give you a topo on this subject every week.

To conclude this analysis, you will find below a graph of the bitcoin price which exposes Japanese candles in daily data. The market is hanging on to the trend line, which is $ 7,090 (€ 6,330). In the event of a break, the BTC will drop to its lows last December; on the contrary, a rebound with volume would engage the target of $ 7,870 (€ 7,140).

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Follow Vincent Ganne on Trading View for further analysis on the financial markets.

The technical thresholds and the trend indicated above are based on the technical approach “price, momentum, sentiment, ichimoku”. The data come from Bitstamp and the graphics of TradingView.

We remind you that the investment in crypto assets, including Bitcoin, is extremely risky. Cryptocurrency prices are subject to significant price fluctuations.


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