Joe McCann, a widely-followed cryptocurrency trader and analyst, has stated that the “recent breakout” for Bitcoin (BTC), the world’s most dominant cryptocurrency, “feels very real” to him.

McCann noted in a detailed tweetstorm that he used Bitcoin futures trading data to arrive at his conclusion, or present outlook regarding BTC’s future performance. Going on to reference a chart which shows the “past 36 hours” of a “1-minute snapshot of the price of BTC,” McCann questioned Bitcoin’s recent price movements with respect to BTC futures contracts that expire in September of 2019:

McCann pointed out that If we look at the chart more closely, we can observe significant variations in price movements and patterns – which he explained as follows:

Bitcoin Futures: “Backwardation” Versus “Contango”

According to McCann:

Backwardation is the state where futures buyers are only willing to pay LESS than the current price of the underlying asset, in this case BTC. This is bearish.

The prominent trader also mentioned that “Contango is a state where futures buyers” happily pay more than the underlying asset’s current price “at some point in the future.” This, he said, is bullish.

Going on to reference another chart, McCann observed that a BTC breakout, tracked below, “failed”:

Commenting on the BTC price movements, McCann argued that “since we’re in Contango, spot price” may continue to surge which is “bullish” for Bitcoin:

Understanding Price Breakouts,Failures

He added that the charts above help illustrate “a simple example of why” BTC futures’ “term structure and its state is valuable in understanding breakouts and failures.”

Commenting on the “high price for BTC” on the Bitcoin Mercantile Exchange (BitMEX) of $5,442 at that time, McCann mentioned that this particular price was notably “$196 higher than [that day’s] trading low of $5246.”

Finally, McCann clarified that the highs and lows for BTC, referenced in his tweets, are based on BitMEX’s XBTU19 contracts, not XBT Perpetual. Bitcoin is currently trading at $5,570.38 according to CryptoCompare data, as its price has surged nearly 5% in the past 24 hours.