On January 26, The Chicago Mercantile Exchange's first batch of Bitcoin Futures expire...
A few days ago, Bitcoin's price went into the basement, briefly dipping below $10K USD before recovering dramatically.
Although there were a number of factors at play causing this crash, you can not overlook the fact that short-selling Bitcoin futures on the CBOE expired the day following this huge crash, and before most of the recovery took place.
On January 26, the CME, a much larger trading entity than the CBOE, has a new batch of Bitcoin futures expiring.
Envision this trading tactic:
First, imagine you have access to millions of dollars. You place a futures contract betting that Bitcoin's price will drop to $10 000 on January 26. You buy millions of dollars worth of Bitcoin, causing the price to move up. People join in buying as more traders do the same. You wait until a short period before your futures expire, say a day or so. You then liquidate your Bitcoin at the inflated price. The price tumbles back to $10K. You win the futures contract as it expires and re-buy Bitcoin while it is still low.
Watch for a significant price drop in Bitcoin on January 25. I recommend sheltering your Bitcoin, or at least partially hedging it, in Ethereum or USD Tethers. Following the dip, buy back into Bitcoin on the 26th in the early stages of its recovery.
In time, futures will become less of an issue as they will be renewing and expiring on a constant basis. At the moment, it is a sole set of contracts expiring at once since it is the first set of CME contracts, so it should make larger waves than future contract expirations.
You might not be a whale, but you can take advantage of the waves they cause!
*This is not professional trading advice - just my opinion!
source:
https://cointelegraph.com/news/first-bitcoin-futures-contract-expires-at-10900-win-for-bears
image source:
http://bombayoutdoors.com/outdoor-decor/backyard-playsets/
Good advice...I think NEO may be the better shelter right now.
Tethers is a uniquely effective shelter since its value is pegged at the US dollar, so it only varies by small percentages compared to other cryptocurrencies. That's why I recommend it. NEO has been a pretty solid coin lately, too, but more volatile than Tethers. It's still a safer bet than leaving it in BTC during a crash.
Thanks, something keep on my toes about.
You can see that at the moment traders are bullish as Tethers are dropping slightly in value (they do vary in value slightly), meaning traders are buying BTC and other coins with their Tethers. Tethers get traded into BTC, then BTC gets traded into other coins. So BTC price spikes while Tether drops, then other coins spike. This indicates confidence that prices will go up, or else they would be sheltering their assets in Tethers.
Thanks, maybe I really need to start using usdt as a store during bad times.