In recent times, Bitcoin has tried to maintain its stability despite various turbulent financial instances that took place. However, as per data from Glassnode, an on-chain analytics firm, the trail is expected to be short-lived and the volatility surge is on the horizon.
According to Glassnode, high volatility for Bitcoin is on the horizon as liquidity and volumes decline across the board. It notes that with price ranges compressed and on-chain transfers at cycle lows, BTC is unlikely to sit still for very long.
As reported by Todayq News, previous data from Glassnode had suggested that the asset’s seven-day price range touched record figures. It explicitly stated that Bitcoin’s price difference was one of the tightest over the last three years.
It stated the current trend is comparable to January 2023 and July 2020, both of which preceded large market moves. The on-chain analytics firm stated this might suggest high volatility was imminent.
Additionally, on Wednesday, Glassnode posted a tweet highlighting its recent evaluation of common technical pricing models. Reportedly, the Bitcoin spot price remains marginally above the currently equivalent 111-day-moving average (DMA) and 200-week-moving average (WMA), providing a region of support.
In this context, the 111 DMA and the 200 MA both coincide with the $26,200 level. Glassnode analysts say in the event of a volatile move below the aforementioned levels, the convergence between the 365 DMA ($22,300) and 200 DMA ($22,600) can then be considered an area of interest for price action. In this context, a well-defined range is seen between $22,300 and $26,200.
Additionally, Glassnode highlighted Bitcoin is nearing historical oversold levels as the current adjusted MVRV ratio is coinciding with what were historically oversold levels in 2018, 2019, and March 2020 cycle lows.
The increasing volatility of Bitcoin has also been highlighted by several crypto analysts and influencers. Will Clemente, a crypto analyst, has drawn attention to a major compression on the BTC chart, which he infers to be a “big move soon.”
Simultaneously, another crypto analyst named Ali tweeted :
Bitcoin appears to be losing all major areas of support. This increases the probability of a correction to the next important demand wall between $23,200 and $24,000, where 850,000 addresses had previously purchased 340,000 BTC.
The Bitcoin outflow levels have maintained their traction in recent times and the exchange balance has continued to decline. The Bitcoin exchange balance has fallen below 12%, this is the lowest value achieved since this was first achieved at the beginning of the year.
Hence, the BTC investors have eagerly looked towards the asset as it maintained its stability but currently, there remains a question as to will the investors’ intent continue with the anticipated volatility or not. As of writing, Bitcoin is changing hands at $26,387.60, about a 0.25% increase over the past day.