Bitcoin has been surging in recent days, leading to a shift in market sentiment as investors take note of its renewed momentum.
Despite recent price gains, key data from Coinglass reveals that Bitcoin 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, which could propel it towards 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 closely monitoring this trend, with some suggesting low volatility could signal a period of consolidation before a significant breakout.
As Bitcoin continues to rise, breaking through key resistance levels, traders are wondering whether this sustained, low-volatility environment will persist or if a sudden reversal could propel BTC to new heights.
A change in the price of Bitcoin?
Bitcoin has seen a significant price increase since Tuesday, following the Federal Reserve's announcement of a 50 basis point interest rate cut.
This rally has rekindled optimism in the cryptocurrency market, with some investors and analysts suggesting that it could mark a turning point leading to a broader bullish trend. The Federal Reserve’s decision is seen as a major factor in the recent price action, as lower interest rates tend to push investors towards riskier assets like BTC, thereby boosting demand.
Prominent cryptocurrency analyst Daan has shared Coinglass Key Factshighlighting that Bitcoin's volatility remains relatively high for this cycle. However, compared to previous cycles, it has not yet reached the extreme levels that typically accompany major price movements.
According to Daan, this suggests that while BTC is experiencing some volatility, the true surge could still be ahead. 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 interest rate cut may act 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, which could lead to new highs as volatility kicks in. For now, investors are watching closely to see if this consolidation phase will give way to a stronger rally.
BTC Price Tests Key Liquidity Levels
Bitcoin is currently trading at $62,995 after facing a clear rejection from the 200-day daily moving average (MA) at $63,977. This key indicator signals BTC’s long-term strength, and reclaiming it as support could trigger a significant increase in price.
For the bulls to maintain the momentum, the price must sustain above the crucial $60,000 level and eventually reclaim the 200-daily MA. If BTC manages to overcome this resistance and consolidate support, a quick challenge to the 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, if the $60,000 support level fails to hold, a deeper correction could occur, which would push the price down to lower demand levels. Investors are closely watching these key levels to determine the next move in Bitcoin price as staying above $60,000 remains critical to maintaining the bullish momentum.
Featured image of Dall-E, chart from TradingView
