Bitcoin Volatility Falls To Lowest In Almost 4 Months


&l;p&g;&l;img class=&q;dam-image getty size-large wp-image-1134984063&q; src=&q;https://specials-images.forbesimg.com/dam/imageserve/1134984063/960×0.jpg?fit=scale&q; data-height=&q;640&q; data-width=&q;960&q;&g; Bitcoin has been experiencing lackluster volatility lately, trading range-bound.&a;nbsp;

Bitcoin price volatility recently&a;nbsp;reached&a;nbsp;its lowest since mid-November, market&a;nbsp;research&a;nbsp;reveals.

Yesterday,&a;nbsp;the&a;nbsp;30-day historical volatility of the BTC/USD pair&a;nbsp;fell&a;nbsp;to its lowest level since November 14, &l;span&g;data provided by&a;nbsp;&l;/span&g;&l;span&g;cryptocurrency prime&a;nbsp;dealer&a;nbsp;&l;/span&g;&l;a href=&q;https://www.sfox.com/&q; target=&q;_blank&q; rel=&q;nofollow noopener noreferrer&q; target=&q;_blank&q;&g;SFOX&l;/a&g;&l;span&g;&a;nbsp;shows.&a;nbsp;&l;/span&g;


&q;Over the past months, we&s;ve generally observed tight range-bound trading with very short spikes in both volatility and price to both the upside and downside,&q; said&a;nbsp;Danny Kim, SFOX&s;s head of growth.

&q;While cryptoasset prices remain, as a whole, highly volatile and difficult to predict, the BTC/USD pair&s;s volatility is currently at its lowest point since mid-November 2018.&q;

&q;Before that time, its volatility hadn&s;t been this low since mid-May 2017,&q; he noted.

The chart below helps illustrate&a;nbsp;the price fluctuations of BTC/USD over roughly the last three years.


&l;img class=&q;size-large wp-image-2856&q; src=&q;http://blogs-images.forbes.com/cbovaird/files/2019/03/image-1-1200×518.jpg?width=960&q; alt=&q;&q; data-height=&q;518&q; data-width=&q;1200&q;&g; This chart shows BTC/USD&s;s 30-historical volatility.

&l;span&g;&l;/span&g;

&l;strong&g;Range-Bound Trading&l;/strong&g;

Bitcoin prices have been trading within a relatively tight range&a;nbsp;over the last week, fluctuating primarily between $3,800 and $4,000, CoinDesk &l;a href=&q;https://www.coindesk.com/price/bitcoin&q; target=&q;_blank&q;&g;data&l;/a&g; reveals.


Looking at this situation, market observers might think that the blue-chip digital currency was building up support in this range.

According to some experts, they should guess again.

&q;Bitcoin has been building a minor support at $3,800,&q; noted&a;nbsp;&l;span&g;Mati Greenspan, an analyst for social trading platform&a;nbsp;&l;/span&g;&l;a href=&q;https://www.etoro.com/en-us/&q; target=&q;_blank&q; rel=&q;nofollow noopener noreferrer&q; target=&q;_blank&q;&g;eToro&l;/a&g;&l;span&g;.&a;nbsp;&l;/span&g;

&q;However, its not a support level that you can really lean on.&q;


&l;span&g;Jon Pearlstone, publisher of the newsletter&a;nbsp;&l;/span&g;&l;a href=&q;https://www.cryptopatterns.net/&q; target=&q;_blank&q; rel=&q;nofollow noopener noreferrer&q; target=&q;_blank&q;&g;CryptoPatterns&l;/a&g;, concurred, stating that &q;$3800 cannot be defined as strong support.&q;

&q;The real supports are exactly where they&s;ve been since December at $3,500 and $3,000 respectively,&q; said Greenspan.

&l;strong&g;A New Normal?&l;/strong&g;

Bitcoin traders may certainly&a;nbsp;be used to&a;nbsp;substantial volatility.

However,&a;nbsp;the digital currency has experienced periods of relative stagnation, noted&a;nbsp;David Martin, chief investment officer at U.S. asset manager&a;nbsp;&l;a href=&q;https://www.blockforcecapital.com/&q; target=&q;_blank&q;&g;Blockforce Capital&l;/a&g;.


&q;The overall lack of price movement, consolidation, and trailing volumes since mid-December are reminiscent of bitcoin&s;s price action late summer and early fall, where volatility was negligible compared to long term averages for bitcoin,&q; he stated.

&q;&l;span style=&q;font-weight: 400&q;&g;We saw a downward spiral in November, and it appears the market is returning to the lower-than-average volatility environment as investors take a wait and see approach with the flagship cryptocurrency.&q;&l;/span&g;

&l;em&g;Disclosure: I own some bitcoin, bitcoin cash and ether.&a;nbsp;&l;/em&g;&l;/p&g;