The price of Bitcoin is losing more than 2.5% on the crypto market over the course of today's trading day, dropping below the key $60,000 mark. As naturally happens, the whole market is in deep red too, with an aggregate loss of almost $100 billion in capitalization, and liquidation over the day was subjected to positions for twice as much.
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However, amid the negative market sentiment, a notable event occurred. Today's price drop allowed BTC to close a gap on the BTC price chart on the CME exchange from June 28. On that day, Bitcoin futures opened at $62,085 - 2.8% above the closing price of the previous day, leaving an unclosed gap on the BTC1 price chart.
Source: TradingViewWhat does it mean?
On financial and crypto markets, price gaps occur when an asset opens significantly higher or lower than its previous closing price, creating a gap on the chart. These gaps often act as magnets for future price movements, as traders anticipate the asset will eventually return to the gap level to "close" it.
The significance of CME gaps for Bitcoin lies in their predictive power, as market participants closely watch these gaps for potential trading opportunities.
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The closing of a downward gap can be seen as a bullish signal for BTC. It indicates that the market has addressed an imbalance, potentially paving the way for a price rebound.
While today's market drop might seem negative at first glance, the closure of the CME gap could suggest a positive outlook for Bitcoin in the near future.