An early morning rally in Bitcoin price filled a CME Futures gap to the upside leftover from the weekend’s post-halving profit-taking drop.
Now that the gap has been filled, where may Bitcoin be headed next in the days ahead? And why are gaps something crypto traders need to continue to pay close attention to?
Bitcoin CME Futures Gap Filled With Latest Early AM Rally
In the earliest hours of the morning, when trading volume is at its lowest, Bitcoin price made yet another push to try and take out $10,000.
The powerful overhead resistance is the key to unlocking Bitcoin’s bull market, but the crypto asset continues to struggle with the oft-tested area.
Last week, the leading cryptocurrency by market cap breached above $10,000 momentarily but was rejected back down. Over the weekend, Bitcoin price collapsed from highs to as low as $8,100, leaving a massive price gap on the price charts of BTC Futures trading on the Chicago Merchantile Exchange, better known as CME Group.
CME volumes have been exploding prior to the halving, and the institutional focused platform continues to have a massive influence over Bitcoin price action.
Now that the gap has been filled to the upside, Bitcoin price often drops after. Gaps to the upside and downside remain unfilled, which could provide logical targets in the future for the cryptocurrency.
What Are Gaps And Why Do They Matter?
Gaps are voids left on asset price charts went powerful price movements take place outside of normal trading hours.
CME Group is an institutional platform, trading Monday through Friday. When the trading session ends on Friday, that’s it for CME for the weekend.
But with Bitcoin, the crypto market never sleeps, and the asset keeps on trading at spot exchanges.
When trading resumes on the next trading session, a gap is left behind. These gaps are filled with extreme accuracy, typically within the first week after they’re added to price charts.
It has caused them to be an important factor that all crypto traders need to pay close attention to.
Gaps are commonly found on the prices of speculative assets, where irrational exuberance and extreme fear causes prices to deviate substantially from reality.
Not all gaps are filled, however, or at least not quickly. A gap still remains at $3,500, while another is above $11,000. Given Bitcoin‘s recent volatility and price action, filling both gaps isn’t’ out of the question, and could provide targets for the crypto asset to trade towards in the days and months ahead.
Featured image from Pixabay