Sharp Bitcoin price move expected as volatility hangs at record lows and sellers are ‘exhausted’
Bitcoin’s (BTC) lack of volatility has been the dominant discussion point among traders for the past two weeks and the current sideways trading within the $18,000 to $25,000 range has been in effect for 126 days. A majority of traders agree that a significant price move is imminent, but exactly what are they basing this thesis on?
Let’s take a look at three data points that predict a spike in Bitcoin volatility.
According to Glassnode research, the “Bitcoin market is primed for volatility,” with on- and off-chain data flashing multiple signals. The researchers note that 1-week realized volatility has fallen to 28%, a level that is typically followed by a sharp price move.
Exploration of Bitcoin’s aSOPR, a metric which “measures an average realized profit/loss multiple for spent coins on any given day” shows:
In addition to the divergence between the price and the adjusted SOPR, short-term Bitcoin holders are approaching their breakeven level as the short-term holder SOPR approaches 1.0.
This is significant because a reading of 1.0 during a bear market has historically functioned as a level of resistance and there is a tendency for traders to exit their positions near breakeven.
If the aSPOR were to crest above 1.0 and turn the level to support, it could be an early sign of a fledgling trend change within the market.
Multiple technical analysis indicators are also flashing a signal that a strong directional move is in the cards, a point noted by independent market analyst Big Smokey.
According to the analyst:
Bitcoin price range, SuperGuppy and Bollinger Bands are getting real tight. ETH looks the same. You know what that means. pic.twitter.com/e7s6ScG7jz
Crypto research firm Delphi Digital recently issued a similar
Read on cointelegraph.com