A classic Bitcoin volatility indicator is currently at a historic low, which some analysts suggest could signal a sharp price movement. In the past, similar signals have been accompanied by strong price increases. Will it happen again?
Bollinger Bands and Bitcoin #
According to a post on X by analyst Gert van Lagen, the Bollinger Bands Bandwidth indicator for Bitcoin has dropped below 100, a relatively rare signal. This indicator measures the percentage difference between the upper and lower bands of the Bollinger Bands, which in turn track Bitcoin’s price volatility.
Van Lagen points out that previous instances when the indicator fell below 100 coincided with significant increases in Bitcoin’s price. Conversely, values above 400 often led to declines, he says. He compares the current situation to late 2023, when Bitcoin’s price rose by about 40% in a short period.
‘Bitcoin to New All-Time High’ #
In follow-up posts on X, Van Lagen references the November 2023 signal, after which Bitcoin’s value doubled in four months. He outlines his expectation that Bitcoin could potentially rise to a new all-time high, which he believes could be followed by a bear market. To illustrate, he draws parallels with the stock price development of Google between 2004 and 2008.
Other Analysts on Bitcoin #
Not all market analysts are equally optimistic. Roman Trading wrote on X that Bitcoin is still declining and may need to test a new bottom. “Many people are calling: bottom! But in my view, Bitcoin has dropped to $45,000 without bouncing back. Nothing ever goes down in a straight line,” Roman Trading stated. He indicated he would buy Bitcoin again if it falls to $50,000, or invest elsewhere.
According to Rekt Capital on X, Bitcoin has one more month to produce a green yearly candle for 2025 and maintain the four-year cycle.