Bitcoin is currently experiencing a period of low volatility, with prices stagnant around $90,000. This stability is unusual and historically precedes significant price movements, with previous drops in volatility leading to swings of 20-30%. The Bollinger Bands Width indicator also highlights extreme price compression, similar to past instances that resulted in substantial upswings. As historical trends suggest, such market conditions may signal an impending breakout or downturn, potentially affecting Bitcoin's future direction as investors watch closely.
When looking at previous instances where volatility was this low, Bitcoin followed up with significant price movements: A rally from $50,000 to a then all-time high of $74,000.
Historically, such low volatility levels are rare and tend to be short-lived. Every time volatility dropped to this level, Bitcoin experienced a move of at least 20-30%, if not more.
The Bollinger Bands Width indicator...signals that Bitcoin is coiled for a big move. The last time this happened, Bitcoin experienced a 200% price surge within weeks.
The quarterly bands are currently at their tightest levels since 2012, meaning that price compression is at an extreme.
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