Bitcoin, which has shown weakness despite the moderate approach of FED President Jeremo Powell, is at the level of $ 64,000.
While investors postponed their hopes for a rise to August and subsequent months after a busy July, an analyst claimed that the Bitcoin volatility indicator pointed to a price increase in the near future.
On-chain analyst Matthew Hyland said in his analysis that Bitcoin volatility indicator Bollinger Bands have reached their tightest point in twelve months.
Stating in a recent video that Bitcoin’s weekly Bollinger Bands are at the third narrowest level in history, Hyland pointed out that this situation had only been seen before in April 2016 and August 2023.
Hyland also stated that Bitcoin has consolidated in a narrow range of 25% since March 13, and stated that he believes that this long consolidation period is now over.
Considering the fact that the consolidation period lasted for a long time and the Bollinger Bands reached their third narrowest level in history, the analyst predicted that the consolidation period would end in Bitcoin within a month and a significant rise period would begin.
Referring to the general acceptance in the market that “the longer the consolidation lasts, the greater the rise will be afterwards”, the analyst claimed that if history repeats itself, a new ATH could be seen in Bitcoin by November.
“Bitcoin Weekly Bollinger Bands have only tightened this much twice so far. In April 2016 and in August 2023. We are now seeing the same thing once again. Afterwards, Bitcoin increased by approximately 20% between August and November 2023.
Here, an upward movement in Bitcoin is inevitable and this movement is its main issue. This move will probably come within a month.
“If history repeats itself, Bitcoin could reach a new ATH of around $77,000 by November from its current price.”
Apart from Hyland, cryptocurrency analyst MaxBecauseBTC also said, “Bitcoin’s weekly timeframe Bollinger Bands have only been this tight twice so far… In April 2016 and August 2023.”
What Does a Squeeze in Bollinger Bands Mean?
This tightening is typically interpreted as a harbinger of significant price movements, either up or down.
While this squeeze shown by Bollinger Bands can mean both a bullish and bearish trend signal for Bitcoin, which side the direction in BTC will be depends on various factors such as market sentiment and future positive or negative news, as well as technical indicators.
At this point, analysts interpret the narrowing of the Bollinger bands as the calm before the upward storm.
*This is not investment advice.
