Bitcoin has surged in value over the past few days, causing a shift in market sentiment as investors take notice of the renewed momentum.
Despite the recent price surge, key data from Coinglass reveals that Bitcoin’s volatility remains remarkably low compared to previous cycles. This unusual calm amid the surge has raised questions about whether BTC is gearing up for another major move, potentially reaching all-time highs (ATH) this year.
Historically, Bitcoin’s biggest rallies have been accompanied by sharp spikes in volatility, but current data suggests the market may be waiting for a catalyst to spark stronger price action. Analysts are keeping a close eye on this trend, with some suggesting the low volatility could signal a period of consolidation before a significant breakout.
As Bitcoin continues to rise and break key resistance levels, traders are wondering whether this persistent low volatility environment will last, or if a sudden shift could propel BTC to new highs.
A Shift in Bitcoin Price?
The price of bitcoin has risen sharply since Tuesday, after the Federal Reserve announced it would cut interest rates by 50 basis points.
This rally has rekindled optimism in the crypto market, with some investors and analysts suggesting that it could mark a turning point that leads to a broader uptrend. The Federal Reserve’s move is seen as a major factor in recent price action, as lower interest rates often push investors into riskier assets like BTC, fueling demand.
Leading crypto analyst Daan has shared Coinglass key datawhich highlights that Bitcoin’s volatility remains relatively high for this cycle. However, compared to previous cycles, it has not yet reached the extreme levels that usually accompany large price movements.
According to Daan, this suggests that while BTC is experiencing some volatility, the real rise is yet to come. He believes that once the price breaks out of the consolidation range it has been in for most of 2024, volatility will increase significantly.
The Federal Reserve’s rate cut could serve as a catalyst for this next phase. If BTC can maintain momentum and break through key resistance levels, the market could see a rapid acceleration in price action, potentially leading to new highs as volatility hits. For now, investors are watching closely to see if this consolidation phase will lead to a stronger rally.
BTC Price Testing Key Liquidity Levels
Bitcoin is currently trading at $62,995 after facing a clear rejection from the daily 200 moving average (MA) at $63,977. This important indicator signals long-term strength for BTC, and reclaiming it as support could spark a significant price surge.
To maintain the bulls’ momentum, the price needs to stay above the crucial $60,000 level and eventually reclaim the daily 200 MA. If BTC manages to break this resistance and solidify the support, a quick challenge to local highs around $65,000 is expected, with a possibility of testing $69,000, the previous all-time high set during the 2021 cycle.
However, failure to hold the $60,000 support level could lead to a deeper correction, pushing the price towards lower demand levels. Investors are closely monitoring these key levels to determine the next move in Bitcoin’s price action as holding above $60,000 remains crucial to maintaining bullish momentum.
Main image of Dall-E, chart from TradingView