Ah, Bitcoin! The ever-elusive specter of wealth, dancing tantalizingly before our eyes, much like a will-o’-the-wisp leading the unwary traveler astray. In this latest episode of our financial soap opera, we find ourselves in a rather curious predicament: Bitcoin (BTC) has been flitting about in a most narrow range, reminiscent of a cat caught in a sunbeam, basking in the warmth of $100,000, which seems to be its favorite spot. 🐱💸
On the 23rd of January, the astute minds at Glassnode, those modern-day oracles of onchain analytics, took to their digital pulpit to proclaim that BTC/USD was behaving in a manner most peculiar, confined within a “very narrow” range. One can almost hear the gasps of disbelief echoing through the halls of cryptocurrency enthusiasts! 😲
BTC price range channels October 2023
Our dear Bitcoin bulls, ever hopeful, have not abandoned the lofty heights of $100,000, which has become a veritable lodestar for market sentiment. For over two months now, BTC/USD has been frolicking between the bounds of $90,000 and $110,000—a behavior that, according to Glassnode, is becoming quite the rarity in this wild world of digital currency.
Upon delving into the annals of 60-day BTC price ranges, the researchers unearthed a fascinating tidbit: the last time such mid-term price variety was so constricted was back in the fateful month of October 2023. “Bitcoin’s current 60-day price range is very narrow,” they mused, “and historically, such tight price ranges often herald the arrival of heightened volatility.” One can only imagine the excitement brewing among traders! 📈
At present, the 60-day range stands at a mere 19%—a level so rare it has graced us only five times since 2019. And lo and behold, this very phenomenon in 2023 coincided with a significant surge in BTC prices, rising from a humble $30,000 on October 22 to a staggering $42,000 by the end of the year—a 40% increase in the blink of an eye! Talk about a rollercoaster ride! 🎢
“Moreover,” Glassnode continued, “20% of $BTC supply is concentrated within ±15% of the spot price.” This, dear reader, creates a veritable powder keg of potential market volatility, as the profitability of investors sways like a pendulum in the wind. 💨
“This creates the potential for amplified market volatility as investor profitability shifts.”
In their latest newsletter, “The Week Onchain,” released on January 21, Glassnode elaborated on this intriguing price range data. “When supply is highly concentrated around the spot price, small movements in price can significantly affect investor profitability, which in turn can amplify market volatility,” they confirmed, as if revealing the secrets of the universe. 🌌
“After the Bitcoin price peaked in December, it started to consolidate, creating a dense concentration of supply with a cost basis close to the spot price.”
Bollinger Bands deliver classic breakout hints
Despite the occasional short-lived flurries within this range, the volatility of BTC prices remains historically low, as evidenced by the ever-popular Bollinger Bands indicator. One can almost hear the sighs of traders longing for the days of wild price swings!
As noted by the astute trader and analyst Matthew Hyland earlier this month, on 3-day timeframes, the Bands were recently as close together as two old friends sharing a secret since January 2024. 🤫
In December, the indicator’s creator, John Bollinger, highlighted the classic behavior of the Bollinger Bands from the BTC/USD daily chart, as if he were a maestro conducting a symphony of market movements. 🎶
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2025-01-23 15:46