- LedgerX debuts physically-settled mini BTC futures with a monthly expiry.
- Bitcoin price remains pivotal at $10,000; recovery to highs above $10,400 is an uphill task.
- Bitcoin chances of dropping to $9,000 increase by the hour, mostly if support is shattered at $9,790.
Bitcoin bulls are focused on breaking short term resistance at the 50 Simple Moving Average (SMA) in the hourly timeframe. The push for recovery comes after another dip to $10,000. Last week, support above $9,750 once again failed to make the much anticipated CME gap to $9,600, discussed on several accounts by the FXStreet’s team since last week. For now, the path of least resistance appears to be upwards but can the flagship cryptocurrency sustain momentum above $10,250.
BTC/USD hourly chart
LedgerX physically-settled Bitcoin mini futures
The bloodshed in the cryptocurrency market, and especially Bitcoin, is likely to have overshadowed the launch of regulated physically-settled Bitcoin mini futures product by LedgerX. The launch comes months after Bakkt launched the first regulated physically-settled Bitcoin futures, sparking a lot of interest across the industry.
The LedgerX mini BTC-USD futures are currently open to individuals and investors. The products are fully collateralized (with cash or Bitcoin) and come with monthly expiries (every last Friday of each month). The regulated exchanged has the mini BTC futures “denominated in 1/100th Bitcoin, and are listed alongside our Bitcoin mini options and Bitcoin mini swaps.
What are physically settled Bitcoin futures?
Physically settled-BTC futures were popularized by Bakkt, a subsidiary of the Intercontinental Exchange (ICE), in 2019. Unlike Bitcoin futures on CME, which are settled in dollars, BTC physically-settled futures are redeemable for the underlying asset (Bitcoin) at their maturity. Therefore, there are two physically-settled BTC futures products in the market; one by Bakkt and the most recent by LedgerX. According to the CEO of LedgerX, Zack Dexter:
Futures have always been a part of the company’s roadmap, and we are excited about today’s launch. Futures and options are a big part of the trading landscape. We believe it is important to have a complete suite of listed products to enhance platform liquidity and the ability to effectively hedge risk.
Bitcoin technical analysis
The daily BTC/USD chart shows the price hanging at the edge of a cliff while holding onto support provided by an ascending channel. All technical indicators point towards increasing selling pressure. It is improbable that Bitcoin will continue with the short term uptrend described in the introduction.
BTC/USD daily chart
For instance, the Relative Strength Index (RSI) seems to have hit a snag at 40, cutting short the recovery eyeing the midline. The ongoing retreat is reminiscent of the failure of BTC for a break above $10,100. Instead, a return to $10,000 is brewing. If the channel support is broken, there is a big chance Bitcoin will plunge to refresh June and July’s support at $9,000. Moreover, trading below the 50-day SMA only emphasizes the bearish grip.
BTC/USD weekly chart
The weekly chart shines a light on the impact of a double-top pattern. Bitcoin is yet to find formidable support from which to launch the much-awaited upswing to levels above $12,000. In this timeframe, the RSI is relatively flat; in other, words buying pressure and selling pressure currently balance out. The tight range could lead to a volatility constriction that can break out, either up or down. Therefore, traders must hold on for a breakout either up or down before going all-in on their positions. In the near term, the pivotal trading at $10,000 will continue.
Bitcoin fundamental analysis
According to the data provided by IntoTheBlock, precisely the In/Out of Money metric, the bellwether cryptocurrency will continue to struggle with resistance in the range between $10,099 and $10,389. The 8,740 BTC (volume) currently holds the price purchased at a minimum price of $10,080. If the hurdle at $10,389 is broken, recovery to highs above $11,000 will be relatively easy. The next significant resistance lies in the range between $11,316 and $11,625, with 752,970 BTC (volume) purchased in the zone.
Concerning support, it is clear that buyer congestion between $10,080 and $10,099 is not strong enough to hold Bitcoin afloat. Bitcoin will eventually pull downwards to the next support at $9,790. The Strongest support for Bitcoin lies at $9,500 and $8,882, as highlighted in the above chart.
Bitcoin price has the potential to remain pivotal at $10,000 this week. Gains past the resistance at $10,389 could catapult it to highs above $11,000. However, the journey to highs above $12,000 is likely to suffer a delay at $11,625.
On the downside, if support at $9,790 is broken, there is a chance BTC would spiral to confirm support at $9,500 (in away closing the CME gap). A reversal from this support might be substantial, but if losses continue, it would be a miracle if $9,000 remains intact.