Market Overview

Could Bitcoin Futures Be The Catalyst To Put CME Group Over The Top?

Could Bitcoin Futures Be The Catalyst To Put CME Group Over The Top?

CME Group Inc (NASDAQ: CME), operator of the world’s largest options and futures exchange, announced this week that it will be launching bitcoin futures starting in the fourth quarter.

Following the news, CME stock rallied 3 percent to new all-time highs, and bitcoin may be just the catalyst the stock needs to break into uncharted territory.

The Chicago Mercantile Exchange has traded on the Nasdaq since its 2002 IPO. After trading as low as $5.08 in its first year on the market, it rallied as high as $100.89 prior to the financial crisis. CME merged with the Chicago Board of Trade in 2007, forming CME Group. In 2008, CME Group acquired NYMEX Holdings, and in 2010, the company took a 90 percent stake in the Dow Jones Indexes.

After bottoming at $22.43 during the financial crisis, CME stock traded mostly sideways in a range between $34 and $52 from late 2009 through the beginning of 2013. From that point, it broke out to the upside and never looked back, hitting an all-time high of $138.49 in early October.

The stock rolled over, dropping back down to its 50-day simple moving average at around $132. However, the bitcoin news propelled the stock to what could be the beginning of its next leg higher this week. On Thursday, CME Group closed above $140 for the first time ever.

Short-term traders should be watching for a continuation of the rally on Friday and into next week. Until the company gives some fundamental updates on the bitcoin launch, the stock will likely continue to trade on near-term technicals.

Joel Elconin contributed to this story.

Related Links:

Bitcoin Futures Are Coming To CME Group

A Guide To Who Loves And Hates Cryptocurrency


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