BVOL says: “No.”Bye-bye, Bitcoin.
BVOL is breaking out of a multi year resistance.
Looks like this halving really will be different after all.
Good luck, y’all!
BVOL trade ideas
BVOL BREAKING OUT OF FALLING WEDGEWe see the BVOL breaking out of its falling wedge formation, and moving above its Weekly level of 16.67
For those who are unaware, the BVOL measures the amount of volatility coming to the bitcoin chart. Just like the S&P200's VIX chart.
From my analysis of Volatility charts, there tends to be an equilibrium point in which price tends to gravitate to.
Considering there is a gap that 9/10 times may be filled, we can expect price to move towards it, making its way to the equilibrium point.
This may be a sign of a more downside for bitcoin, and the whole crypto space.
Keep watch Fam
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BTC & BTC Volatility - Volatility at all time lowNobody is talking about Bitcoin volatility, but everybody is talking about VIX - so here's the chart and please join me for this TED talk on the history of bitcoin volatility index BVOL when compared to BTC.
We can argue about how BVOL is calculated and whether or not it's relevant but whatever your opinion may be, you need to focus more on the comparison between the two instead of what they actually are. We do know they're relatives of each other and that's what matters the most.
The first significant event I want to discuss is the all time high on BVOL which was right around February 6. This is where BTC created a (temporary) major bottom that lasted through most of 2018.
Next - BVOL made a new low. Volatility was extremely low and this was around November 12 leading into a major cliff dive. We all remember this, right? BTC was stuck at around $6400 for what felt like a year, even though it was only a month or two.
Next - BVOL had a huge recovery going into November / December and into 2019. BVOL created a significant top around December 14 which happens to be when BTC was around $3200 - do you remember the low? It was around $3100. Who cares about a $100 miss on a long term trade? Only overleveraged degenerates that use high leverage and can't manage a trade.
Ok, next.... we had a huge run going into June/July and if you didn't get out, you were WARNED on February 8 when BVOL created a bottom and started moving up. BTC was around $9900 at the time and took a NOSE DIVE into the $4000-$5000 area. Bitcoin was dead back then, remember?
But then.... BVOL created a high. A pretty significant one. It started to curl down when BTC was at around $7000. You could have taken that run to $60,000 if it weren't for BVOL creating a significant low around July 27 which put BTC at $11k.
BTC did drop a bit... down into around $10k and each time BVOL spiked up, there was a selling opportunity.
I try to focus on only the major pivots that are in the extreme territory. I think it's safe to say that BVOL is in extremely low territory seeing that it has never been here before. Each time we've seen an extreme low, we've seen BTC drop. I know, it's hard to think that BTC will drop from here. You're so bullish! Everyone is!
Be careful trading with the herd and whatever you do, make sure you have a plan.
Have. A. Plan.
Pop or Drop? Only 5x in History has BTC done this!Traders,
Bitcoin has recently become less volatile than the markets. The chart here represents Bitcoin's volatility over the Dow's. In the bottom pane you will see that as the red line rises, it indicates BTC is becoming more volatile than the Dow. As it falls? Less. Rarely, has it touched the zero point (horizontal red line in bottom pane).
As you can see from my chart, we have only touched the zero point area only 4x in previous history. We are now on the 5th. After each touch (represented by the vertical line), huge moves have followed. The first was a 50% drop. Everything else thereafter was fairly significant pops. So far, the data shows a 75% probability of a pop. Will we make it 80% with this touch or is another big drop in store?
Either way, a big move is incoming? What's your call? Post in the comments below.
Stew
BTC FAIR MARKET VALUE IN RELATION TO VOLATILITY VS. GOLD. Came across this article which confirmed what I long suspected. The more institutionalized BTC becomes the more it's volatility decreases and value increases but there is a cut off. Fair market value will always be in the forefront as far as an investment grade asset. BTC overtaking gold is highly unlikely in our lifetime. At present, there is in global circulation roughly $11 TRILLION in gold. Compare that to BTC where all the bitcoins in the world were worth roughly $1.03 trillion. Bitcoin is worth only about 9% of the world's gold supply. The combined value of bitcoin was equivalent to just 2.9% of the world's money.
JPMorgan says its long-term bitcoin price target of $150,000 is unlikely as surging volatility challenges institutional adoption.
Bitcoin's "fair value" is 12% below its current price, based on its volatility in relation to gold, according to JPMorgan.
The bank's analysis was made on the assumption that bitcoin is four times as volatile as gold, strategists led by Nikolaos Panigirtzoglou said in a note Tuesday. In that scenario, bitcoin's value would be one quarter of $150,000, or $38,000, they said.
But if bitcoin were only three times as volatile as gold, then its fair value would be around $50,000, they added.
Bitcoin last traded 1.8% higher on the day around $43,564, close to its highest for a month, but is still down 8% so far this year, according to data from CoinMarketCap.
JPMorgan's long-term price target for bitcoin is $150,000, up from last year's $146,000 target, assuming that its volatility level meets that of gold, or bitcoin allocations get the same weighting as gold in investor portfolios.
But the bank thinks this target is unlikely to be reached any time soon, given that such a neat intersection between gold and bitcoin may not happen in the foreseeable future.
Bitcoin has had a rough start to the year, with the overall cryptocurrency market slumping, as appetite for risk assets waned against a backdrop of persistently high inflation and the Federal Reserve's increasingly hawkish stance. The leading cryptocurrency fell below $36,000, and ether tumbled below $2,500 — both off from record highs of around $63,000 and $4,800, respectively.
One of the major drivers for crypto in the last two years has been the huge amounts of cheap cash that has emanated from fiscal and monetary stimulus programs during the pandemic, and much of that is now coming to an end.
JPMorgan said January's crypto market correction, in which bitcoin lost 17% in value, looks less like capitulation, or an extended period of decline, in comparison to last May when bitcoin fell 35%.
Still, strategists said the biggest challenge for bitcoin is its volatility, as it's often unappealing to institutional investors.
JPMorgan said cryptocurrencies are seeing hot growth relative to other alternative asset classes, but this doesn't have to stem from continually rising prices.
"This growth does not necessarily need to come from continuous price appreciation of existing cryptocurrencies such as bitcoin and ethereum, already popular among institutional investors, but in our mind it is more likely to come from the expansion of the universe of digital assets," the strategists said.
BTC volatility decreasing > Bullish momentum still activeUntil the golden cross takes place, BTC is to continue its current bullish trend.
edit: typo error
Bitcoin Volatility Spike [BEARISH]Something to keep an eye on at the moment is the recent and confirmed spike on the BVOL chart we have seen last week. Furthermore, the BVOL is now finding support at a very key level where if held could see Bitcoin volatility spike again here in the coming hours and days.
As we can see the Bitcoin bulls failed to make a lower low here on the chart which now forces one to become very cautious if you are a Bitcoin bull currently. Longer term everything on the BVOL still looks bullish for the price of Bitcoin but short term, a continued bounce in BTC Volatility could mean a further pullback in Bitcoin here in the coming days. I will be watching closely to see if the BVOL can close back below the light green support line line I have drawn before seeking any further longs.
The second scenario would be a spike up to our red downward sloping trendline that has rejected the BVOL 3 separate occasions on very significant time scales. This area would be an excellent area to begin buying Bitcoin again as well.
For now I will wait and see as it appears retail traders have now been woken out of their slumbers and their sudden irrational FOMO could be setting the table for one last nasty shakeout before Bitcoin decides to run to higher prices again.
Lastly, for the ultra bullish case, a break not just back below my light green support line, but ultimately below my yellow line at 64.44 basis points is the level that must get broken before the floodgates of liquidity can rain down on the asset again. This last check box would almost certainly mean a likely revival of the Bitcoin bull market again.
BVOL Breaking BearishThe Bitcoin Volatility Index has broken bearish and looks to be confirming. This indicator in the past has been a bullish to neutral signal for bitcoin in the past as the asset tends to do much better and show more stability when there is less hype and speculation in the market.
It should also be noted that in the past as the BVOL fell, bitcoin was either bottoming or simply trading sideways before ultimately still running up in price.
This is a great chart to watch, as institutional whales love to buy bitcoin when the BVOL is at low levels.
Bitcoin Volatility look at the past (Fractal?)Can we see the volatility fractal repeating with similar results?
Bitcoin Volatility - Long and StrongBitcoin volatility (BVOL) is at the historical lows. It does not stay there for long. Hard to find a better hedge for your altcoin exposure.
Bitcoin Historic Volatility Only Here Every Few Years
Imagine expecting a $2000 move out of this
So unless you are calling for 3K, fuck off with your downside targets, it's going to 16-17.5K.
(and if you are calling for 3K, go find another job cuz u clearly suck at this one)
**also my bad: it happens every year or so, not every few years.
Bitcoin - This Chart is Giving the Bears a Reason to Droll!Bitcoin gained +35% in the past 9 days, its best performance since early this February.
At this point, most technical indicators have breached into overbought territories especially in the higher time-frames. Bitcoin may be just about out of rocket fuel for now.
As a trader, I'm always looking out for conditions that can cause a change of trend ahead of time.
To most people, right now the seas seem calm, the skies look clear, and it might even appear as if we should blast straight through 10k or beyond in the coming days.
I do not want bitcoin to go down, however, I can feel a storm brewing and think BTC will see some rough seas ahead.
Check out this current setup in the plot of volatility versus Bollinger bands...
Volatility has fallen outside the bottom band, indicating a very extreme condition. This likely means investors have become complacent and comfortable in their positions, perhaps a little bit too comfortable.
This will likely trigger a broad market sell signal once the indicator comes back within its bands.
Always adapt, be realistic with yourself, control your emotions, and prepare for condition changes ahead of time. It looks like there could be some choppy waters ahead so please be careful!
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Trade only with risk capital; that is, trade with money that, if lost, will not adversely impact your lifestyle and your ability to meet your financial obligations.
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Good luck :)
