Cryptocurrency

Low volatility of Bitcoin reaches 3 months

The price of the main criptomoneda remains stable despite major events such as the Halving. This Tuesday, we met 3 months to begin a period of low volatility of the Bitcoin.

This period of quiet has been markedly lower since the month of march. It should be recalled that, after the announcement of the pandemic, the price of Bitcoin suffered a sharp fall, reaching less than $ 5,000 per unit. Subsequently, he began to recover and slowed their rise a few days before the cut quadrennial.

According to the analysis portal IntoTheBlock, the low volatility may be a result of various factors. The most prominent of them, it would be an uncertain tilt of this digital currency in the market.

Since march is held low, the volatility of Bitcoin

According to the figures of the said firm, in the past 30 days, the volatility in the value of Bitcoin in the market has fallen to 39.43%. A look at the same for a period of 2 months, yields a decrease of 51.69%. These figures are the lowest since march.

From the 7th of march, they began to see the first signs of high volatility. But it was from the 9th of that month of June, when the same is fired. From that date, the volatility rose from 45.04% to 131.90% in a short span of time. Then, it remained relatively stable to begin to fall dramatically.

Behavior of the price as a result of the low volatility

The price of Bitcoin remained on a recovery trend in the same period in which the volatility left to climb. In the successive weeks to the sharp fall in march, its rise led him to overcome the margin of $ 10,000 but not sustained much time in this strip.

The days prior to the Halving, were the largest increase, which raised expectations. However, a few hours before the event, suffered a setback. Since then, its market value has swung between $ 9.300 and $ 9,900 grant. At the time of writing, its price is $ 9.783.

The price, it should be noted, has played an important role in the mining sector in terms of the obsolete equipment. It was expected that the Halving, that cuts off half the reward per block mined, outside inclement with the miners under a power of hash.

However, the recovery of the value of the Bitcoin, gave the old equipment a boom that has enabled them to survive. In addition, a successive decrease in the difficulty has increased a little more this time.

But, the current price could be the limit for many of them. A slight drop, due to the volatility of Bitcoin, would force them to log out or migrate to the mining of other cryptocurrencies.

The low volatility of Bitcoin, is expressed in a period of 30 days on the chart. Source: IntoTheBlock

Correlation of the volatility to predict movements in the price

It is important to note that, according to the analysis, the periods of low volatility are followed by violent ruptures. Although it is uncertain the direction that you can take a break on the price of Bitcoin in these moments, we can point out that the longer the period of price volatility is reduced, the stronger might be that hypothetical rupture.

It is of note that this is low volatility of Bitcoin that has lasted for a consecutive quarter. In spite of this, this far above the levels reached in February. In that month, the price of Bitcoin had flirted with the $ 11,000 for then fall sharply to $ 5,000 less than a month after.

Also, during other periods of time, when the volatility has remained low, the price has moved so strong. For example, in September of 2018, volatility remained below 35%. As a result, the price dropped to $ 2.300.

In regards to the current trend, as already said, its direction is uncertain. Despite this, if the price of Bitcoin manages to consolidate above the $ 10.500, could result in a break to the upside.

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About the author

Belinda Carey

Belinda Carey

A finance girl by education, Belinda has been drawn to cryptocurrencies ever since Bitcoin first emerged in the 2009. Nearly a decade later, Belinda is actively working to spread awareness about cryptocurrencies as well as their impact on the traditional currencies.

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