Bitcoin Volatility Reaches Low Set Ahead Of April 2019 Rally, Will History Repeat?

Tony "The Bull" Severino

1 year ago

3 mins read

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Bitcoin has been uncharacteristically stagnant for over two full months now. The trading range has been tightening, which has led to record low levels of volatility in the otherwise volatile asset.

But the low volatility taking place currently has reached a level that kicked off an explosive uptrend in April 2019. Will the leading cryptocurrency by market cap experience another parabolic move similar to the last time around?

What Happened to Cryptocurrency’s Signature Volatility?

The cryptocurrency asset class is historically known for its wild price swings and explosive volatility. This is the primary reason new investors are offered the advice to never invest more than they can comfortably afford to lose.

Incredible returns are possible, but so is the chance that all of your investment capital gets wiped out. That’s what many crypto investors learned the hard way buying into the peak 2017 media frenzy.

After Bitcoin’s meteoric rise from $200 to $20,000, the asset then fell back to $3,200. An over 80% drawdown was enough to deal a critical blow to anyone who bought in just ahead of the bubble bursting.

But just as powerful as drawdowns are, so are Bitcoin’s rallies. In April 2019, after spending months consolidating around the current bear market bottom, an explosive breakout occurred.

Bitcoin has once again been consolidating for months and has fallen to a low level of volatility that hasn’t been reached since that April 2019 pump. The rally resulted in an over 300% climb from $3,200 to $14,000.

With volatility at such low levels and after months of sideways trading, will Bitcoin see a repeat and a powerful parabolic breakout once the range ends?

Source: Arcane Research

Bitcoin Drops To Volatility Low That Triggered Last Bullish Impulse in April 2019

According to data from Arcane Research, Bitcoin’s 30-day volatility has now fallen to 1.82%. The last time the asset had such a lapse in its signature volatility, a massive breakout occurred with a $1,000 hour-long price candle.

The April 2019 breakout kickstarted three months of an uptrend, that took the asset from $3,200 to $14,000.

The crypto market went wild with speculation, with analysis pointing to a single actor strategically placing buy orders across three crypto exchanges. Others claimed it was algrothjm-based trading bots picking up on fake April Fools day news about a Bitcoin pump, and responding with orders.

Whatever the reason, Bitcoin paused its bear market for a massive rally.

The breakout came after the cryptocurrency fell to current volatility lows, and after nearly 100 days of consolidation. Bitcoin has reached the same level in terms of volatility but hasn’t been consolidating quite as long.

Price action from the last bull market breakout suggests that the tight trading range may continue for the foreseeable future, unfortunately. Unless revisiting the current low in volatility triggers yet another parabolic bull run.

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.
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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.
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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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