- The latest drop caused long order liquidations worth $230 million alone for the Bitcoin perpetual contracts on BitMEX.
- Traders are eyeing an unfilled CME gap at roughly $9,600 which occured back in July.
- The 200-day moving average is also offering indications of a further descent to ~$9,000.
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Bitcoin led the broader cryptocurrency market crash this week, which lost $50 billion in total market capitalization since Wednesday.
Bitcoin dipped 16% from $11,919 in the last two days to record lows in the four figures at $9,987 on Bitstamp. Ethereum also plunged below $400 as traders witnessed a sea of red.
Bitcoin Crash Reveals Unfilled “CME Gap”
The latest drop caused long order liquidations worth $230 million alone for the Bitcoin perpetual contracts on BitMEX. As traders begin to see a recovery in prices, $10,000 remains a crucial psychological support level for the cryptocurrency. However, traders are highly anxious about the CME gap at $9,615.
“Gaps” refer to the difference in the opening price of an asset from the closing price in the previous trading session. They are a common occurrence in traditional markets but were unknown to the 24/7 crypto traders before the launch of the Chicago Mercantile Exchange’s (CME) Bitcoin futures.
A massive $310 gap on the CME futures chart is left unfilled since the break-out during the weekend of Jul. 25 to Jul. 27 when the CME remained closed. The tendency to fill the CME gap is exclusive to cryptocurrency markets, often in the same week.
While these gaps have historically been filled, Willy Woo, an on-chain analyst, tweeted:
“The CME is quite new and certainly was not around in 2016 when we had a similar stage in the macro cycle.”
One of the other characteristic features of a Bitcoin bull market is price action above the 200-Day Moving Average (MA). Even in the long-term bull cycle between 2016 and 2017, the price of BTC never closed below the 200-Day MA….