Open Interest (OI) for Bitcoin (BTC) Futures Trading on the Chicago Mercantile Exchange (CME) The new record has moved to new heights On Oct. 1, BTC recovered পাঁচ 5,550 to its five-month high bitstamp.
The total number of outstanding derivatives deals in the CME Group’s Bitcoin futures market reached 3. 3.22 billion, just 40 40 million less than the record in February 2021, according to data provided by ByBt.com. Nevertheless, the OI was at the top of Bitcoin prices in mid-April.
In detail, Bitcoin Future OI at CME was 14 3.02 billion on April 14, the day BTC reached a price of around 65 65,000. But on October 14th, mid-April was 6% higher than the OI reading, even as BTC was priced between $ 57,000- $ 58,550.
Traders often use OI as an indicator to confirm trends in both derivatives and spot markets. For example, it is explained that new money is coming into the market regardless of the growing number of outstanding derivatives contracts.
Meanwhile, in the case of Bitcoin, the growing open interest in the futures market indicates an increase in BTC exposure to recognized investors.
The commercial sector increases Bitcoin futures exposure
Recent OI readings indicate that more institutional capital is entering the bitcoin market. As a result, investors have become more confident about opening new positions in the $ 50,000- $ 58,000 price range, with CME volumes trending higher over the past seven days.
Analysts See Uniform growth across OI, volume and price as signs of new buying in the futures market. This puts the underlying resources in a better position to continue its improvement. So it seems that Bitcoin is going through a similar upward trend.
The main evidence of a bullish bitcoin Comes The Commodity Futures Trading Commission’s record, released on October 5, notes that the commercial sector – which is made up of corporate hedgers – has accelerated their bitcoin futures purchases. They now hold a net position of over 10,000 BTCs.
At the same time, however, hedge funds and retail investors have narrowed the net in the bitcoin futures market. Nevertheless, it may be their strategy to offset long positions elsewhere, such as in the spot market.
This is mainly due to the higher annual premium available on CME Bitcoin futures prices on the spot market. In recent days, CME Bitcoin futures prices have been regularly trading above 15% of the BTC spot price, compared to an average of 7.7% in the first nine months of 2021.
The macro fundamentals behind the Bitcoin revival
Recent purchases in the Bitcoin spot market also appeared in the wake of statements from U.S. regulators.
For example, Gary Jensler, chairman of the Securities and Exchange Commission (SEC), and Jerome Powell, chairman of the Federal Reserve, discouraged bans on bitcoin. Meanwhile, the growing possibility of Bitcoin ETF approval by the SEC has also fueled the “rumor-buying” narrative.
Related: Bitcoin Analyst ‘Highly Suspicious’ Returns 50K – Will Weekly Close Spark A Correction?
Investors also sought exposure to the bitcoin market as consumer prices continued to rise in the United States, with the Consumer Price Index (CPI) rising 5.4% year-on-year in September for the first time in thirteen years, according to the Department of Labor.
Inflation came in at 5.4% in September, a 13-year high.
Bitcoin has just crossed $ 58,000 which is the highest price since May this year.
Bitcoin continues to act as the best inflation hedge in the world.
– Pomp (ompAPompliano) October 14, 2021
JPMorgan Chase noted in his recent report that high inflation persuaded institutional investors to seek exposure to Bitcoin, with some even seeing cryptocurrency as a better sheltered asset than gold. In another report published in January 2021, the US banking giant expected the price of BTC to reach 140 140,000 in the long run.
“The gold rush as an‘ alternative ’currency refers to the big lies for Bitcoin in the long run,” it noted.
“The consolidation between volatility between bitcoin and gold is unlikely to happen quickly and is a multi-year process in our minds. This means that the above $ 146,000 theoretical bitcoin price target should be considered a long-term goal, and thus a stable price target for this year.”
The opinions and opinions expressed here do not necessarily reflect the views of the author and Cointelegraph.com. With every investment and trading move involving risk, you should conduct your own research when making decisions.
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