Recently, Bitcoin seems to have cooled off a bit. Its Google search trend has significantly dropped, and it has fallen below 25th place in search rankings. This indicates that people's interest in Bitcoin is not as high as before, and the excitement and speculative desire in the market are noticeably lacking. This quiet scene is also related to the Bitcoin volatility index (DVOL) being at a historical low. The DVOL is currently hovering above 40, one of the lowest values in over two years, just after the mid-2023 low.
Why is Bitcoin so 'cold' right now?
1. People have lost interest.
Think about it, when Bitcoin's price used to fluctuate wildly, many people would search to see if they could make a profit. But now that there are no major price movements, people feel it's not as interesting, and they pay less attention to it. It's like a bustling market suddenly becoming quiet; no one is interested in browsing.
2. The market lacks new stimuli.
The market currently lacks new excitement. There are no major positive news, no policy stimuli, and no significant events to drive the price of Bitcoin. Everyone is waiting to see if there will be any new developments. It's like waiting for a bus; you don't know when it will arrive, so you might as well go somewhere else for a while.
3. The volatility is too low, and there are few opportunities to make money.
The low volatility index of Bitcoin indicates that price fluctuations are small, and the market is relatively 'calm.' In this situation, speculators find it hard to find opportunities because prices aren't rising or falling, making it difficult to profit from price differences. It's like rowing on a calm lake; while it's stable, there's no sense of excitement.
Will Bitcoin continue to fall?
From the current situation, Bitcoin's popularity is insufficient and may continue to decline. Why do I say that?
• Market sentiment is low: Everyone seems disinterested, trading activity has decreased, and naturally, prices are hard to improve.
• No major capital driving the market: Large institutions are not taking significant actions, and small retail investors lack interest, leading to a lack of financial support for the market, making it difficult for prices to rise.
• Technical indicators are also not looking good: From a technical analysis perspective, the price trend of Bitcoin appears to be somewhat 'weak,' with key support and resistance levels not performing well, and bears are dominating.
Now may not be the best time to enter the market. If you already hold Bitcoin, you can continue to hold it, but don't expect significant returns in the short term. If you haven't entered the market yet, it might be better to wait.