Bitcoin: Past bear markets share this resemblance with BTC’s state of 2022

ambcrypto.com:

All good things must come to an end as Glassnode, in a new report, found that volatility returned to the Bitcoin [BTC] market last week. According to the blockchain analytics platform, the leading coin, at press time, traded in a period of historically low volatility. Additionally, many on-chain and off-chain metrics hint at an imminent period of “elevated volatility” for the king coin. 

Before last week, the BTC market had been marked by an uncharacteristically low degree of price volatility. This was in sharp contrast to the broader financial markets (equity, credit, and forex markets) which have been significantly unstable.

According to Glassnode, if historical precedents in bear markets are anything to go by, with the current volatility in the market, the price per BTC might move in any direction when the volatility calms.

Glassnode also found a significant divergence between BTC’s price action and its Adjusted Spent Output Profit Ratio (aSOPR). For context, when the metric is precisely one in a bullish trend, it often acts as a support as buyers tend to buy the dip. Conversely, when aSOPR equals one in a bear market, it acts as resistance as investors scamper for any available exit liquidity. 

In the current market, a divergence price/aSOPR divergence was underway. As BTC’s price declines, the volume of losses recorded would also decline. This would indicate sellers’ exhaustion within the current price range, Glassnode found.

With the weekly average of aSOPR approaching the break-even value of 1.0 from below, Glassnode opined,

“it is increasingly likely that volatility is on the horizon, either as a breakout or yet another rejection.”

Source: Glassnode

Furthermore, Glassnode considered the aSOPR metric by the constituent