CME Data Predicts Bitcoin Price at $13K in June-July, Institutional Investors Are Bullish

Bitcoin, the first-ever digital currency which was created in 2008 by Satoshi Nakamoto and came into limelight in 2009 is renowned for its volatility, a factor that influences the price and market value of all other digital currencies collectively known as altcoins. CME data shows that Bitcoin remains bullish despite trading below $10,000 all week long. As we approach the end of a trading season, institutional investors are unfettered by the price of CME Bitcoin Futures which stood at $30.

The frontline cryptocurrency experiences periods of huge price volatility referred to as bubbles and busts. When bubbles occur, it is as a result of heightened activities of bulls while busts signify the overpowering of the market by bears. In 2011, the value of one bitcoin rapidly rose from about $0.30 to $32 before returning to $2. This sharp price range can occur within a short period of time while at other times, it takes longer. A typical indication is the bubble experienced in December 2017 when BTC traded at its all-time high of $19783.06 as against its price of $800 – $1,150 in January of the same year. The price dipped further in the following months leaving its current price at $9,546.50.

CME Observes Bitcoin Halving Effect

BTC recently passed through its 3rd Halving stage which refers to the stage in which the number of coins that miners receive for adding new transactions to the blockchain being cut in half. The process helps to prevent the excess circulation of BTC as the reward becomes lower making it unattractive for miners. Typically though, Halving has proven to impact the price of BTC. The process reaffirms the principle of demand and supply: with the reduced rewards and availability of BTC, the existing ones tend to be more valuable. This halving effect could explain why institutional investors remain bullish as observed by the CME data.

The CME data also predicts a likely strategy of institutional buyers to acquire CME Bitcoin options markets currently fixed at $11,000 for June and then sell at $13,000 in July. This trading behavior also contributes to the current bullish run of BTC. The implication as it is already in effect will result in a more aggressive purchase of Bitcoin right now for eventual selling off. This might be a smart strategy as several other BTC price indicators have backed the massive bullish run of BTC in the coming months