After marking a new annual ATH in mid-July, the price of bitcoin came to stabilize around $29-30K. Since then, fluctuations on the parent cryptocurrency have stagnated, which suggests some movement to come in the cryptocurrency market.
Status of BTC
We mentioned in the Bitcoin analysis of July 27, 2023, two scenarios. So far none have emerged. Indeed, since that date, bitcoin has been platonic. It traded and is still trading around $29K and $30K.
The current technical analysis was carried out in collaboration with Elie FT, passionate investor and trader in the cryptocurrency market. Today a trainer at Family Trading, a community of thousands of own-account traders active since 2017. You will find Lives, educational content and mutual aid around the financial markets in a professional and warm atmosphere.
Lack of speakers? Uncertainty in the market? Bullish and bearish force at the same level? The point on which everyone agrees is the fact that the volatility on the crypto market is significantly revised downwards. It can be seen by different indicators such as the ATR or by the Bollinger bands.
Perhaps the most significant indicator is the Bitcoin Historical Volatility Index.
Bitcoin Historical Volatility Index
The Bitcoin Historical Volatility Index (BVOL) is a measure of past volatility in the price of bitcoin. It is based on analyzing how Bitcoin prices change over a specific period, usually days or weeks.
This low volatility may paradoxically signal a recovery in the latter. Indeed, in the past, a BVOL7D under the single $3 has caused the rebound of the latter several times and, at the same time, prevented significant movements on bitcoin. Thus, everything suggests that this scenario could see the light of day again in the more or less near future.
Please note, as seen in the analysis of July 27, 2023, there are many divergent factors. This makes it difficult to know where this long-awaited movement could go. This is the reason why it is necessary to pay attention to the various supports and resistance.
Bitcoin Price Assumptions
For a bullish scenario, one should consider re-entering the $30-32K zone. The breakout of this zone upwards could give us new bullish targets, starting with the zone of 35K or even $38K.
For a bearish scenario, one would first have to imagine a return to $28K. The breakout of this level could give us as our next objective, the support of $27K. Finally, if the latter does not hold, we will have to hope that the support of $25K holds.
Conclusion
From a technical point of view, bitcoin is still in a decisive phase. Indeed, the price of BTC remains below a strong resistance. However, it manages to hold above $29K. The next movements are likely to be decisive and potentially significant given the current volatility threshold. It will be important to carefully observe the reaction of the price on the different identifiable levels to confirm or not the different hypotheses made. Beware of potential “fake outs” and “market squeezes” in each situation. In addition, it should be remembered that these scenarios are based solely on technical analysis. The price of cryptocurrencies can change more or less quickly, depending on other more fundamental factors.
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