Large funds on CME buy Bitcoin on correction
According to the COT (Commitments of Traders) reports provided by the Commodity Futures Trading Commission (CFTC) - for the week ended last Tuesday:
Large speculators (NON-COMMERCIAL) reduced the net position for the sale of bitcoin contracts by 0.25 thousand contracts to 2.42 thousand. Large speculative players began to reduce the net position for sale after a two-week build-up.
Small speculators (NONREPORTABLE POSITIONS) reduced the net position to buy bitcoin contracts by 0.30 thousand contracts to 2.05 thousand Small speculators began to reduce the net position to buy also after a two-week build-up.
Hedgers (COMMERCIAL) increased their net position to buy bitcoin contracts by 0.05 thousand contracts to 0.37 thousand. Hedger operators are increasing their net buy position for the second week in a row, and for 3 weeks out of the last 4.
Open interest increased by 0.54 thousand contracts to 10.49 thousand.
The bearish index of large speculators (the ratio of the number of contracts for sale to the number of contracts for purchase) fell by 0.12 to 1.44 for the week.
Summary: COT reports on bitcoin reflect the growth of bullish sentiment among major speculators. Large funds actively increased purchases, taking advantage of the corrective decline, which led to a reduction in the net position for a decline in BTC by 9% for the week. At the same time, the net position began to decline from the maximum levels for the last month. The continuation of this trend may contribute to the growth of the cryptocurrency.
At the same time, large funds continue to increase sales, and some of them are hoping for a continued decline in bitcoin.
Small speculators in the last week mostly reduced purchases. Small speculators have been marked by an increase in bearish sentiment, but this group of traders usually does not have a significant impact on the market.
Hedgers have been increasing their net position for 3 weeks out of the last 4, aimed at reducing bitcoin. Among hedgers who trade more long-term, bearish sentiment on the cryptocurrency continues to grow.
Note: COT report data is fundamental and is mainly used for medium and long-term trading. Large speculators, NON-COMMERCIAL (banks, investment funds) usually trade according to the trend. Small speculators, NONREPORTABLE POSITIONS-usually do not have much influence on the market. Hedgers, COMMERCIAL (operators, large companies) usually trade against the trend. The net position is the difference between the number of buy and sell contracts. Open interest is the sum of all open positions in the market.