What to Know:
- A key indicator tied to BTC’s 60-day price range is signaling bullish activity, as noted by Glassnode.
- This suggests potential for wider price changes.
- Recent trading flows show a bullish inclination.
Volatility traders aiming to take advantage of considerable price fluctuations may soon discover new opportunities. A significant indicator suggests that Bitcoin (BTC), trading above $100,000, resembles a coiled spring primed to unleash energy in either direction.
The relevant metric is the rolling 60-day price range, indicating the variation of the maximum and minimum price changes in percentage terms. When the range tightens, it implies stable market conditions characterized by range play and an equilibrium of demand and supply.
According to analysis from Glassnode, Bitcoin’s 60-day price range is now tighter than its current trading range, revealing that such patterns have historically foreshadowed volatility surges.
“All of these instances have occurred prior to a significant burst of volatility, with most occurring during early bull markets or before late-stage capitulations in downtrends,” stated Glassnode in a recent report.
Volatility tends to oscillate around its average. Typically, rapid price oscillations follow periods of low volatility, and vice versa. This does not indicate whether prices will soar or decline but suggests potential for larger and unpredictably fluctuating price movements.
Recent flows have particularly favored bullish betters, especially on the Chicago Mercantile Exchange where traders are increasingly purchasing call options. Similar bullish trends are also visible on Deribit and other exchanges.
“BTC futures are gaining traction, particularly on the short-term, maintaining a solid net-long position from last week. The ratio of bullish bets to bearish ones stands around 20:1,” reported QCP Capital via Telegram.
If this positioning serves as an indicator, market participants seem prepared for a bullish resolution to Bitcoin’s several-week consolidation within the $90,000 to $110,000 range.
