The Bitcoin price rally has been put on hold for the past few months. Much of the reason is coming from a decline in participation. This could be from investors seeing some nice gains in their more traditional investments. Strong earnings from conventional equity stocks, real-estate values surging. People likely have been taking their gains from their cryptocurrency and putting it into hard assets these all could contribute to the stall out in Bitcoin.
Bitcoin Price: Lower Bitcoin Participation can be a good thing for the Bulls
Most recently some of the other lower-priced cryptos like Dogecoin and Ethereum have been the focus of crypto investing, leaving Bitcoin in a sideways market. Lower participation can be a good thing, you typically don’t want to find yourself doing what everyone else is doing. There are computer models that follow the participation of markets. Right now, they are showing a massive decline in Bitcoin participation. Typically, when the market is reaching its high point in participation, that is when you want to start looking for the door to get out.
With Bitcoins price staying sideways and participation dropping, it is giving itself some time to take a breather. Is this a signal of a bear market to come, or is it a time to reload and prepare for another run higher? Will you be in a position to execute quickly when it does move? The Bitcoin price will likely move extremely fast when it does hit a trigger and most of the profits will be made before the news covers it.
Bitcoin Price: Why trade Bitcoin in your RJO account?
Any trader will know that not every trade is a profitable one. But there are tools you can use and information that is at our fingertips that can help you avoid costly mistakes made by beginners.
RJO is a name that has been around for over 100 years. RJO has been through boom-and-bust market cycles so you know your equity is safe. Many of the newer crypto trading platforms are brand new and haven’t been through a full market cycle. Many issues arise from new clearing firms, and the reality is you never know what the next issue is going to be. If you’re dealing with any sizeable amount of equity, I would recommend putting it with a company that has been through all types of markets.
These accounts are margin accounts. You do not need to put up the full value of the contract to trade it. If you hold your position through delivery that is when the full value of the contract will be settled, but almost all positions are liquidated before delivery.
A margin account allows you to be more leveraged. This can be a good thing but can be very bad if you don’t understand. Typically, you need to come up with about 5-12% of the full value of the contract. Right now, a typical Micro Bitcoin contract is about $2700 for margin requirements to get the position traded. From there you have to cover the change if the market works against your position.
In my article from April 20th, “CME’s newest contract makes trading Bitcoin more Feasible.“I pointed out that there was a new micro-Bitcoin contract being offered. That contract is now ready to go. I trading my first contract today. This micro bitcoin market has very good volume considering how new it is. Front-month is trading about 8500 contracts which gives you very good liquidity so you can enter and exit positions very easily. I suspect this contract only to keep gaining volume so you never have to worry about fills at the market.
With the history of the Bitcoin price moving fast and violently, this is a market you will want professional help while trading. One subscription service that helps me when trading unfamiliar markets is located at http://www.edegrootinsights.com. I’ve been using Eric’s subscription service as a way to help build confidence in the positions that I hold. Eric provides beneficial video links in The Matrix.
*Trading commodity futures and options on futures involve substantial risk and may not be appropriate for everyone. Past performance may not necessarily be indicative of future results. *