What You Need to Know About Bitcoin Futures

The Chicago Board Options Exchange (CBOE) will finally launch its long-awaited Bitcoin futures contract on December 10. Meanwhile, the CME Group is expected to launch its futures contract later this month.

The ability to break away from the shift of buy-side-only-trade will surely add a new element to Bitcoin.

A new, institutional and larger participants will be brought into the Bitcoin market. To be sure, any time a new contract launches, you want to get a good gauge of expected movement.

In the last 30 days, the last week and day by one exchange’s measure there is an average true range that occurred:

  • Last 30 days – High of $18,464, low of $5,868
  • The last week – High of $18,464, low of $10,797
  • The last day – High of $18,464, low of $14,610

In the above data, you can see that Bitcoin has a volatile contract. Using a stop-loss order is going to prove paramount. With this, a question still lingers: Will this just be a short-lived contract, like single stock futures, real estate futures or binary futures?

The answer: No one knows.

There are two pieces of advice that any investor may have heard already but still needs to be reminded again – Bitcoin market is volatile and plans your trades.

Any investment has gains and losses

For Bitcoin, an investor needs to experience a roller coaster ride as markets tend to fall twice as fast as they rise. This occurs when investors catch a long-trending bull move, and then when they see their profits start to slip a “panic” occurs and everyone runs for the exit. An investor needs to know how to when to hold on or let go.

Second advice, plan your trades

There is a saying that’s applicable to all investments: Don’t put your eggs in one basket. Planning your trade can help you cope up if the losses of Bitcoin is too great than expected. For new cryptocurrency traders and investors, it is advisable to only allow a small portion of your investment first to Bitcoin.

Bitcoin futures contract is a long-awaited event

With every trade and investment, always make sure you have enough funds to cope up with any loss otherwise, you might get dizzy with the fast gains and losses of Bitcoin in the future.