Topic: Why Futures don't affect on Bitcoin price (explanation) (Read 188 times)
Looks like everybody forgot about futures
I believe that bitcoin prices will be able to continue to fall further and take many years to recover.
Quite pessimistic 
Did you sell your BTC? I'm not, there is simply nothing to be pessimistic, every fall is a opportunity to buy more bitcoin so I never feel pessimistic.
I've updated the last chart and comment to it a bit
I believe that bitcoin prices will be able to continue to fall further and take many years to recover.
Quite pessimistic Did you sell your BTC? I constantly see that the authors of different channels are trumpeting about the impact of Bitcoin Futures, are holding some kind of nondescript parallels without even understanding the issue. I have long wanted to understand whether this is so and set out to understand finally this topic and find out whether futures affect the price of Bitcoin. If you like this post I will be really appreciated for merit and so on. Let's go!
What is Bitcoin Futures in simple language
Futures is an important element of the economy which allows decreasing risks of price changing. The main purpose of Futures is to hedge risks.
For example, a farmer, who collected grain, knows, that high probability of the price will go down from $100 to $50 in Autumn.
In this situation, he wants to hedge his risks of losing money and all he needs to do is to sell Futures for $100 and to buy it later for $50, and puts change to his pocket, hedging himself from price loss in this way
In other words, he is fixing the price, and if everything will be according to his plan he would even earn.
The situation for a stock-seller of Futures, in this case, is an opposite — if the price will go up, it would lose (as it must sell cheaper), if the price will go down — it would earn (as the farmer should pay more)
In the same way, grain buyers want to hedge his risks from summer price increase — and they buy Futures for $50 to fix this price.
But what about Bitcoin? How can we apply Futures to it? Similar — big players hedge themselves from price spikes. Often they open an opposite position — this way they risk less but profits also less.
Why Trade BTC Futures
-hedging of risks
-it’s secure & transparent
-deep liquidity
-ability to trade without bitcoins
CBOE и CME
As we know, there are 2 exchanges which allow trading Bitcoin Futures — CME and CBOE
Image from cryptona.co
The main difference is that the minimum contract size on CBOE is 1 BTC, on CME is 5 BTC.
So CME is bigger and more important for us
CBOE may list for trading up to four near-term expiration weeks ("weekly" contracts), three near-term serial months ("serial" contracts), and three months on the March quarterly cycle ("quarterly" contracts).
CME Monthly contracts listed for the nearest 2 months in the March quarterly cycle (Mar, Jun, Sep, Dec) plus the nearest 2 serial months not in the March quarterly cycle.
You can trade nearly 24 hours a day, five days per week.
Also, you can look at the current price of Futures on CME here
Contract specifications: CBOE, CME
Futures Expiration Dates
Let’s try to understand what expiration dates and how they affect on the price (if they do)
Where can I see the end dates of Futures?
CME Calendar — Go to Filter and choose, Last Day Trade + BTC
CBOE Sheet
Ok, now let’s try to chart all dates of Futures expiration and understand if they influence or no.
Triangles are price reversal points (minimum 3 bars), and bold lines are quarterly cycle expiration dates.
As you can see, it's difficult to catch a clear connection here... Let's then leave the CME (which is larger) only.
So a bit more like a connection, but do not say that there is some clear correlation.
The nearest Futures expiration dates
18.07 — CBOE
27.07 — CME
15.08 — CBOE
31.08 — CME
19.09 — CBOE
28.09 — CME
17.10 — CBOE
26.10 — CME
For myself, I understood the meaning of futures and that this is really a nice and smart tool. But at the expense of influence… Make your own conclusions, but in my opinion, the influence of futures is greatly exaggerated. If there is, what to correct in my research - write in the comments
I think you have to look at the fact that the market is slowly falling into the downtrend and in the long run, so that the bitcoin price can rise sharply and exceed the $ 20,000 mark is very difficult, Absolutely impossible in 2018.What is Bitcoin Futures in simple language
Futures is an important element of the economy which allows decreasing risks of price changing. The main purpose of Futures is to hedge risks.
For example, a farmer, who collected grain, knows, that high probability of the price will go down from $100 to $50 in Autumn.
In this situation, he wants to hedge his risks of losing money and all he needs to do is to sell Futures for $100 and to buy it later for $50, and puts change to his pocket, hedging himself from price loss in this way
In other words, he is fixing the price, and if everything will be according to his plan he would even earn.
The situation for a stock-seller of Futures, in this case, is an opposite — if the price will go up, it would lose (as it must sell cheaper), if the price will go down — it would earn (as the farmer should pay more)
In the same way, grain buyers want to hedge his risks from summer price increase — and they buy Futures for $50 to fix this price.
But what about Bitcoin? How can we apply Futures to it? Similar — big players hedge themselves from price spikes. Often they open an opposite position — this way they risk less but profits also less.
Why Trade BTC Futures
-hedging of risks
-it’s secure & transparent
-deep liquidity
-ability to trade without bitcoins
CBOE и CME
As we know, there are 2 exchanges which allow trading Bitcoin Futures — CME and CBOE
Image from cryptona.co
The main difference is that the minimum contract size on CBOE is 1 BTC, on CME is 5 BTC.
So CME is bigger and more important for us
CBOE may list for trading up to four near-term expiration weeks ("weekly" contracts), three near-term serial months ("serial" contracts), and three months on the March quarterly cycle ("quarterly" contracts).
CME Monthly contracts listed for the nearest 2 months in the March quarterly cycle (Mar, Jun, Sep, Dec) plus the nearest 2 serial months not in the March quarterly cycle.
You can trade nearly 24 hours a day, five days per week.
Also, you can look at the current price of Futures on CME here
Contract specifications: CBOE, CME
Futures Expiration Dates
Let’s try to understand what expiration dates and how they affect on the price (if they do)
Where can I see the end dates of Futures?
CME Calendar — Go to Filter and choose, Last Day Trade + BTC
CBOE Sheet
Ok, now let’s try to chart all dates of Futures expiration and understand if they influence or no.
Triangles are price reversal points (minimum 3 bars), and bold lines are quarterly cycle expiration dates.
As you can see, it's difficult to catch a clear connection here... Let's then leave the CME (which is larger) only.
So a bit more like a connection, but do not say that there is some clear correlation.
The nearest Futures expiration dates
18.07 — CBOE
27.07 — CME
15.08 — CBOE
31.08 — CME
19.09 — CBOE
28.09 — CME
17.10 — CBOE
26.10 — CME
For myself, I understood the meaning of futures and that this is really a nice and smart tool. But at the expense of influence… Make your own conclusions, but in my opinion, the influence of futures is greatly exaggerated. If there is, what to correct in my research - write in the comments
I believe that bitcoin prices will be able to continue to fall further and take many years to recover.
I constantly see that the authors of different channels are trumpeting about the impact of Bitcoin Futures, are holding some kind of nondescript parallels without even understanding the issue. I have long wanted to understand whether this is so and set out to understand finally this topic and find out whether futures affect the price of Bitcoin. If you like this post I will be really appreciated for merit and so on. Let's go!
What is Bitcoin Futures in simple language
Futures is an important element of the economy which allows decreasing risks of price changing. The main purpose of Futures is to hedge risks.
For example, a farmer, who collected grain, knows, that high probability of the price will go down from $100 to $50 in Autumn.
In this situation, he wants to hedge his risks of losing money and all he needs to do is to sell Futures for $100 and to buy it later for $50, and puts change to his pocket, hedging himself from price loss in this way
In other words, he is fixing the price, and if everything will be according to his plan he would even earn.
The situation for a stock-seller of Futures, in this case, is an opposite — if the price will go up, it would lose (as it must sell cheaper), if the price will go down — it would earn (as the farmer should pay more)
In the same way, grain buyers want to hedge his risks from summer price increase — and they buy Futures for $50 to fix this price.
But what about Bitcoin? How can we apply Futures to it? Similar — big players hedge themselves from price spikes. Often they open an opposite position — this way they risk less but profits also less.
Why Trade BTC Futures
-hedging of risks
-it’s secure & transparent
-deep liquidity
-ability to trade without bitcoins
CBOE и CME
As we know, there are 2 exchanges which allow trading Bitcoin Futures — CME and CBOE
Image from cryptona.co
The main difference is that the minimum contract size on CBOE is 1 BTC, on CME is 5 BTC.
So CME is bigger and more important for us
CBOE may list for trading up to four near-term expiration weeks ("weekly" contracts), three near-term serial months ("serial" contracts), and three months on the March quarterly cycle ("quarterly" contracts).
CME Monthly contracts listed for the nearest 2 months in the March quarterly cycle (Mar, Jun, Sep, Dec) plus the nearest 2 serial months not in the March quarterly cycle.
You can trade nearly 24 hours a day, five days per week.
Also, you can look at the current price of Futures on CME here
Contract specifications: CBOE, CME
Futures Expiration Dates
Let’s try to understand what expiration dates and how they affect on the price (if they do)
Where can I see the end dates of Futures?
CME Calendar — Go to Filter and choose, Last Day Trade + BTC
CBOE Sheet
Ok, now let’s try to chart all dates of Futures expiration and understand if they influence or no.
Triangles are price reversal points (minimum 3 bars), and bold lines are quarterly cycle expiration dates.
As you can see, it's difficult to catch a clear connection here... Let's then leave the CME (which is larger) only.
So a bit more like a connection, but do not say that there is some clear correlation.
There are only 2 points when the price changed direction within 4 days after futures expiration!
And NO points when the price changed direction within 2 days (and less) after futures expiration
The nearest Futures expiration dates
18.07 — CBOE
27.07 — CME
15.08 — CBOE
31.08 — CME
19.09 — CBOE (quarterly)
28.09 — CME (quarterly)
17.10 — CBOE
26.10 — CME
For myself, I understood the meaning of futures and that this is really a nice and smart tool. But at the expense of influence… Make your own conclusions, but in my opinion, the influence of futures is greatly exaggerated. If there is, what to correct in my research - write in the comments
What is Bitcoin Futures in simple language
Futures is an important element of the economy which allows decreasing risks of price changing. The main purpose of Futures is to hedge risks.
For example, a farmer, who collected grain, knows, that high probability of the price will go down from $100 to $50 in Autumn.
In this situation, he wants to hedge his risks of losing money and all he needs to do is to sell Futures for $100 and to buy it later for $50, and puts change to his pocket, hedging himself from price loss in this way
In other words, he is fixing the price, and if everything will be according to his plan he would even earn.
The situation for a stock-seller of Futures, in this case, is an opposite — if the price will go up, it would lose (as it must sell cheaper), if the price will go down — it would earn (as the farmer should pay more)
In the same way, grain buyers want to hedge his risks from summer price increase — and they buy Futures for $50 to fix this price.
But what about Bitcoin? How can we apply Futures to it? Similar — big players hedge themselves from price spikes. Often they open an opposite position — this way they risk less but profits also less.
Why Trade BTC Futures
-hedging of risks
-it’s secure & transparent
-deep liquidity
-ability to trade without bitcoins
CBOE и CME
As we know, there are 2 exchanges which allow trading Bitcoin Futures — CME and CBOE
Image from cryptona.co
The main difference is that the minimum contract size on CBOE is 1 BTC, on CME is 5 BTC.
So CME is bigger and more important for us
CBOE may list for trading up to four near-term expiration weeks ("weekly" contracts), three near-term serial months ("serial" contracts), and three months on the March quarterly cycle ("quarterly" contracts).
CME Monthly contracts listed for the nearest 2 months in the March quarterly cycle (Mar, Jun, Sep, Dec) plus the nearest 2 serial months not in the March quarterly cycle.
You can trade nearly 24 hours a day, five days per week.
Also, you can look at the current price of Futures on CME here
Contract specifications: CBOE, CME
Futures Expiration Dates
Let’s try to understand what expiration dates and how they affect on the price (if they do)
Where can I see the end dates of Futures?
CME Calendar — Go to Filter and choose, Last Day Trade + BTC
CBOE Sheet
Ok, now let’s try to chart all dates of Futures expiration and understand if they influence or no.
Triangles are price reversal points (minimum 3 bars), and bold lines are quarterly cycle expiration dates.
As you can see, it's difficult to catch a clear connection here... Let's then leave the CME (which is larger) only.
So a bit more like a connection, but do not say that there is some clear correlation.
There are only 2 points when the price changed direction within 4 days after futures expiration!
And NO points when the price changed direction within 2 days (and less) after futures expiration
The nearest Futures expiration dates
18.07 — CBOE
27.07 — CME
15.08 — CBOE
31.08 — CME
19.09 — CBOE (quarterly)
28.09 — CME (quarterly)
17.10 — CBOE
26.10 — CME
For myself, I understood the meaning of futures and that this is really a nice and smart tool. But at the expense of influence… Make your own conclusions, but in my opinion, the influence of futures is greatly exaggerated. If there is, what to correct in my research - write in the comments
Jump to: