Analysts say that a key technical indicator of Bitcoin is at its lowest level ever amid low volatility. This usually occurs before a big breakout or volatility spike.
“Bitcoin’s weekly Bollinger Bands are now the tightest in history,” Popular crypto analyst “Mr. Anderson” wrote On Tuesday, referring X technical indicator This shows possible volatility, and overbought/oversold positions.
“When volatility compresses this tightly, expansion always follows,” They said. “Once expansion starts, price almost always tests the outer bands rather quickly.”
Nassar Akkar, the chief strategist at CoinW Exchange, said to Cointelegraph, that Bollinger Bands tightening compression is a sign of a strong market. “signals the calm before a significant volatility storm.”
“While a final September shakeout toward $100,000 is possible, the convergence of negative funding rates, strong seasonal trends, and institutional exchange-traded fund inflows tilts the odds heavily toward a bullish surge upward.”
“Compression this extreme rarely resolves quietly,” said Hunters of Web3 founder “Langerius.”
Over time, Bitcoin’s volatility decreases
Glassnode Researcher “CryptoVizArt” The notion is not acceptable. stating Overall volatility is down across all time frames, mainly because of Bitcoin.BTCBollinger Bands also show a decline.
“This is not a signal, this is not an unexpected structure, this is simply an observation without any real predictive value,” They said.
Breakouts are followed by historical breakouts
Bollinger Bands on Bitcoin extremely tight in early July When the asset traded around $108,000.
Bitcoin experienced a spike in volatility, and the price of BTC soared to an all-time record high on July 14, surpassing $122,000.
In early September the indicator reached its extreme levels on a month-to-month timeframe since BTC trading began.
Related: Bitcoin Bollinger Bands reach ‘most extreme level,’ hinting at explosion to $300K BTC
Septembear, or Uptober next?
Analysts remain on the fence Bitcoin’s next direction as the month of October approaches, which is seen by traders as an important breakout for Bitcoin. “Uptober.”
Tony Sycamore, analyst at IG Group told Cointelegraph on Tuesday Bitcoin “needs more time to correct” The following are some examples of how to get started: “continue to work off overbought readings” After its massive gains in this year.
Many analysts are sharing CoinGlass’ historical performance. chartBitcoin gained value in 10 of the last 12 Octobers, and 8 of the 12 previous fourth quarters.
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Source: cointelegraph.com
