Bitcoin Historical Volatility Approaching Zero Could Signal Blossoming Bull Trend

Tony "The Bull" Severino

4 years ago

3 mins read

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The cryptocurrency known for its wild volatility, Bitcoin, has been trading sideways for several months in a tightening trading range. Historical volatility is approaching zero, for less than the tenth time in the asset’s decade long history.

In the past, this low of volatility proceeds a major move and trend change. Could the metric fast approaching zero be a signal that a new bull trend is blossoming?

What’s Happening To The Cryptocurrency’s Signature Volatility?

The leading cryptocurrency by market cap has spent the bulk of its life thus far oscillating wildly in price. Despite the powerful price fluctuations giving the asset its signature volatility, Bitcoin has been on a steady incline its entire existence.

In just over ten years, the asset has grown from virtually worthless to over $20,000 per BTC. The disruptive financial technology also sparked an entire digital currency revolution.

In nearly as many years, the cryptocurrency has had periods where the asset’s notorious volatility disappears. When this happens, a major short-term trend change occurs. The longer-term uptrend thus far has always remained intact.

Chartered market technicians see that uptrend continuing as soon as Bitcoin price can break above resistance at $10,000 – something it has failed to do several times now.

That breakout could soon occur, now that Bitcoin is once again experiencing a low volatility phase that preceded trend changes in the past.

Bitcoin BTCUSD Historical Volatility | Source: TradingView

Historical Volatility Points To Pivotal Moment, Major Trend Change Is Near

According to the asset’s historical volatitly, the current sideways price action is resulting in readings approaching zero.

This has only taken place less than ten times throughout the cryptocurrency’s over decade long history. And each and every time it has, a big change in trend followed.

Looking at past instances where volatility dropped this low, the first time it happened took Bitcoin from around $10 to $1,000. That peak resulted in the first major bear market.

The next time it happened when BTCUSD finally broke down to set its bear market low.

Another time coincided with a failed attempt at a breakout that marked the bear market double bottom. But the next time, following extended sideways price action, a bullish impulse took Bitcoin close to retesting its then former all-time high.

Next, the low volatility phase led to the historic bull run of 2017 and crypto bubble. That bubble burst in early 2018, but it took until May 2018 for the bear trend to really pick up.

The second bear market in Bitcoin took another six months to plunge to its current bottom at $3,200 – yet another instance where volatility dropped this low.

Volatility picked back up for the entire year of 2019 and exploded in 2020 with the Black Thursday market collapse. The recovery, however, has brought us to the current impasse in Bitcoin price action.

The range simply won’t break, and volatility is now again approaching zero. When this happens, data shows a new trend forms after. But what will it be for Bitcoin? A new bull market, or a deeper fall into a bear market and perhaps a double bottom?

Tony "The Bull" Severino

Tony "The Bull" Severino, CMT, is a distinguished figure in the cryptocurrency analysis sector, renowned for his in-depth technical expertise and innovative approach to market trends. As the Head of Research at NewsBTC, Tony leads a team dedicated to providing cutting-edge insights and forecasts, helping both novice and experienced traders navigate the complexities of the crypto market.
A seasoned Chartered Market Technician, Tony's prowess in identifying and capitalizing on market patterns is unmatched. His academic and professional journey in market analysis has firmly established him as a leading authority in technical trading strategies. Tony’s approach is heavily influenced by the principles of Elliott Wave Theory, a method known for its rigorous assessment of investor psychology and price movements.

Beyond his role at NewsBTC, Tony is the visionary founder of CoinChartist.io, an educational platform aimed at demystifying the nuances of cryptocurrency trading. CoinChartist.io serves as a valuable resource for traders seeking to enhance their technical analysis skills. The platform offers a range of learning tools and resources designed to empower traders with the knowledge to make informed trading decisions.

In addition to his educational initiatives, Tony is a prolific author and a dominant voice in the crypto community. He writes the CoinChartist VIP newsletter, a weekly dispatch that has become a staple among crypto enthusiasts, revered for its insightful analysis and actionable trading advice. This newsletter has consistently ranked as a best-seller on SubStack, boasting thousands of subscribers who rely on Tony’s expertise to guide their trading strategies.

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Before his ascent in the financial analysis world, Tony honed his skills in journalism. His background in this field has endowed him with a unique ability to present intricate market dynamics in a clear and compelling manner, making his insights highly sought after by a broad audience that ranges from casual readers to professional traders.
His professional affiliations underscore his commitment to excellence and continuous learning. As a partner of Elliott Wave International and TradingView, Tony collaborates with other leading experts to enhance his knowledge and skills. His active membership in the CMT Association further aligns him with the highest standards of industry practices and ethics.

Tony’s nickname, "The Bull," aptly reflects his aggressive and optimistic outlook on the cryptocurrency markets. His forecasts often anticipate significant upturns, earning him a reputation for bullish predictions that have frequently led to lucrative outcomes for those who follow his advice.

In summary, Tony "The Bull" Severino, CMT, is more than just a technical analyst; he is a mentor, educator, and innovator whose influence in the cryptocurrency space continues to grow. His dedication to advancing the understanding of market forces and his commitment to providing high-quality, reliable analysis make him a pivotal figure in the world of cryptocurrency trading.

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