Although Bitcoin (BTC) continues to struggle with overcoming the critical psychological level at $28,000, its volatility has dropped to a historically significant range, and previous chart patterns indicate a price increase could follow, although caution is necessary as this has not always been the case.
As it happens, the 60-day volatility levels of the flagship decentralized finance (DeFi) asset as of May 18 was below 40%, which is the eighth time this has happened in the last five years, according to the data shared by the cryptocurrency analytics platform IntoTheBlock in a tweet on May 18.
What this means
As per the analysis, Bitcoin volatility typically “remains below this level for 5 weeks and results in a 46% price gain.” Having said that, the platform’s team noted that there were still three crashes of around 50% that have “followed similar conditions.”
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In other words, these historical patterns and their timing suggest that Bitcoin has a greater chance of getting to the price range of $39,290 in the near future than it does of dropping to as low as $13,500 – although the latter is still a possibility.
Bitcoin price analysis
As things stand, Bitcoin was at the time of publication changing hands at the price of $26,912, which represents a decrease of 1.25% in the last 24 hours and 7.95% over the previous 30 days but still a 1.86% positive change across the past week, as per data retrieved on May 19.
Whether its low volatility pattern leads toward a bullish rally or bearish slump will depend on factors other than its historical behavior on charts, including further mainstream adoption, and perceived capability to act as a hedge against financial crisis.
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