In summary
Volatility #bitcoin is low, but the calm before the storm could provoke significant price fluctuations if any market events occur.
The Bitcoin DVOL index is at a historical minimum, indicating extreme complacency; any unexpected event could trigger serious price fluctuations.
Bitcoin has fallen to $117,305; holding above $117,000 could push it to $120,000, but falling below $115,000 threatens a drop to $112,526.
The price of Bitcoin recently dropped from its all-time high (ATH), signaling a possible change in market conditions. This decline, while seemingly typical, may indicate concerns about future volatility.
Historical data suggests that a volatility explosion may be just around the corner, prompting key asset holders to adopt a neutral position.
Bitcoin is experiencing a calm before the storm
The DVOL index for Bitcoin, tracking the asset's volatility, is at historically low levels. Only 2.6% of days have seen declines in values, indicating extreme complacency in the market. This suggests that investors are not hedging against potential downturns that could lead to significant price fluctuations in the event of unforeseen circumstances that provoke volatility.
DVOL measures expected price fluctuations over the next month, and the current low levels indicate a calm position among traders. However, this calmness may be fleeting, as periods of complacency are often accompanied by sharp volatility swings. In the event of an unforeseen event in the market, Bitcoin could face sharp price fluctuations, which may catch investors off guard.
The overall macroeconomic dynamics of Bitcoin show a noticeable change in investor behavior. The change in HODLer Net positions has slowed down, indicating a decrease in activity among long-term holders (LTH). Although LTH began accumulating at the beginning of the month, this buying trend has paused, likely due to ongoing market uncertainty.
Despite the absence of new purchases, the lack of sales indicates a certain level of optimism among these holders. They seem to be waiting for a clearer market direction before taking their next steps. This suggests that LTH are exercising caution but expect that any surge in volatility could ultimately lead to a price increase, keeping their positions untouched for now.
The price $BTC may hold its support
The price of Bitcoin has shown an upward trend over the month, but in the last 24 hours, this momentum has weakened, and BTC has fallen to $117,305. This drop occurred when the price fell below the established upward trend line, signaling a change in market sentiment.
If investors maintain their positions during the expected surge in volatility, Bitcoin could stabilize above $117,000. This would pave the way for potential growth to $120,000, turning this mark into support and creating conditions for further growth.
However, if investor sentiment turns bearish and sales increase in response to volatility, Bitcoin may face a significant drop. In this case, the price could break the support level at $115,000, potentially reaching $112,526. This would negate all the August gains and devalue the optimistic outlook.