Bitcoin has surged over the past few days, causing a shift in market sentiment as investors take note of its renewed momentum.
Despite recent price gains, important data from Coinglass reveals that Bitcoin volatility remains significantly lower compared to previous cycles. This unusual calm during the surge has raised questions about whether BTC is preparing for another big move, possibly heading for an all-time high (ATH) this year.
Historically, Bitcoin’s biggest rallies have been accompanied by sharp increases in volatility, but current data suggests the market may be waiting for a catalyst to unleash stronger price action. Analysts are keeping a close eye on the trend, with some suggesting that lower volatility may indicate a consolidation period before a major breakout.
As Bitcoin continues to climb, breaking through key resistance levels, traders are left wondering if this ongoing, volatile low area will continue—or if a sudden reversal could propel BTC to higher territory.
A Shift in Bitcoin Price?
Bitcoin has seen a significant price increase since Tuesday, following the Federal Reserve’s announcement of a 50 bps interest rate cut.
The rally has renewed optimism in the crypto market, with some investors and analysts suggesting that this could mark a turning point leading to a broader rally. The Federal Reserve’s decision is seen as a key factor in recent price action, as low interest rates tend to push investors into riskier assets like BTC, fueling demand.
Famous crypto analyst Daan shared important data from Coinglass, highlighting that Bitcoin volatility remains high in this cycle. However, compared to previous cycles, it has not yet reached the extreme levels usually associated with large price movements.
According to Daan, this suggests that while BTC is experiencing some volatility, the real surge may still be going on. He believes that once the price breaks out of the consolidation range it has been in around 2024, volatility will increase significantly.
The Federal Reserve’s interest rate cuts may act as a trigger for this next phase. If BTC is able to maintain momentum and break through key resistance levels, the market could see a quick acceleration in price action, potentially leading to new highs as volatility enters. Meanwhile, investors are watching closely to see if this consolidation phase will pave the way for a strong rally.
BTC Price Testing Key Liquidity Levels
Bitcoin is currently trading at $62,995 after facing a clear rejection from the 200 daily moving average (MA) at $63,977. This key indicator shows the long-term strength of BTC, and re-calling it as support could result in a significant increase in price.
For the bulls to maintain momentum, the price must hold above the key level of $60,000 and eventually find the 200 daily MA. If BTC is able to overcome this resistance and strengthen the support, an immediate challenge to the height of the area around $65,000 is expected, with the possibility of a test of $69,000-the previous set of highs during the 2021 cycle.
However, failure to maintain the $60,000 support level could lead to a deep correction, pushing the price down to the lows of demand. Investors are closely watching these key levels to determine the next move in Bitcoin’s price action, as holding above $60,000 remains critical to sustaining bullish momentum.
Featured image from Dall-E, chart from TradingView