Bitcoin went up by more than $2,000 on Wednesday from circa $11,500 to $14,000 on very high unfiltered volumes of $44 billion.
It fell by the same amount starting last night European time, back to now about $11,800.
You can just about see the big green candle and the red one, with bitcoin almost touching $14,000.
It was jittery however, with fast price movements and a “feel” of great heights, with the correction then to be expected.
At $14,000 it is also where you might have expected a dip with all of this looking pretty normal so far.
The past doesn’t predict the future, they say, but up to $20,000 at least we still have a past as shown in the above chart during the 2017 rise.
Back then bitcoin went from about $9,000 to $12,000 and then back to about $9,000, with it thereafter continuing to move further up.
This time it kind of did the same but at $14,000 where there appears to be some resistance with $17,000 another potentially big resistance.
Had it gone up further without any correction then maybe there might have been reason for concern, but the dip at $14,000 does suggest this is all pretty healthy.
Not least because CME bitcoin futures close tomorrow with an incredible 132,455 bitcoin representative contracts, worth a cool $1.5 billion, exchanging hands there yesterday.
CME’s bitcoin futures have been at a premium and continue to be at a premium at the time of writing, with the premium for September contracts, for example, standing at $600.
Meaning the majority of Wall Street is probably in the green, but presumably there’s some at a loss too.
There was some considerable one off market selling last night, so Wall Street may well have been behind the dip as the June contract now closes on Friday.
This pattern of a dip ahead of futures expiry has repeated for the past three months almost to the dot, with CME’s futures design appearing to facilitate it.
It might not necessarily be something specific to Wall Street, however, with what back then was OKCoin – which had the most popular bitcoin settled futures – likewise creating a pattern ahead of expiry.
That dip at some point presumably turns to a jump ahead of expiry, with volatility so returning to bitcoin and cryptos in general.