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Historic 30-Day Volatility Hints a “Big Move" For Bitcoin Is Coming Soon

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Real Vision Group CEO Raoul Pal foresees an impending “big move” for Bitcoin in the near term. 

On his Twitter account, Pal shared a tweet showing that Bitcoin's historic 30-day volatility has dropped to 20% a total of seven times since 2016. Every time Bitcoin’s 30-day volatility hit 20% in the past four years, a significant price movement occurred in the next several weeks that followed.

Bitcoin's 30-Day Volatility. Source: Raoul Pal, Bloomberg

Would a Volatility Spike Benefit Bitcoin in the Current Environment?

Analysts are predicting Bitcoin will become more volatile in the coming months.

Pal explained that in the past, when Bitcoin’s 30-day volatility hit 20%, it surged “immediately” after and hit 80% in a matter of months.

Bitcoin 30 day historic volatility has been falling fast and is in the 20's. In the past it has hit 20% vol 7 times. 6 times prices exploded higher immediately and vol hit 80% in a few months. 1 time (Nov 2018) prices fell sharply. Either way, a big move is coming soon.

Since September 3rd, Bitcoin has mostly been moving within a tight range between $10,000 and $11,000. The dominant cryptocurrency has struggled to break down or upwards from the range, leading volatility to slip.

In the medium term, on-chain indicators and technicals suggest Bitcoin could see a stable uptrend, given its reaction to the $10,500 support level.

As the BTC Times previously reported, there were several major events that might have placed additional selling pressure on Bitcoin. 

On October 1st, the U.S. Commodities and Futures Trading Commission (CFTC) charged BitMEX of violating the Bank Secrecy Act.

Then on October 6th, U.S. President Donald Trump abruptly delayed stimulus talks, causing the equities market and Bitcoin to slump in tandem.

Bitcoin has remained above $10,500 since demonstrating resilience despite the pessimistic macro factors.

Some Indicators Signal a Bottom

Researchers at Santiment believe that Bitcoin's recovery from $10,500 is a positive sign for its medium-term trend, especially given its rebound from the stimulus woes.

Did Trump's ambiguous update about the stimulus package signal the local bottom for Bitcoin? According to our data, BTC bounced off of $10.55k & has gradually climbed since this announcement that spiked stimulus discussion on #crypto platforms.

The confluence of the intensifying uncertainty in the global market and the sharp decline in Bitcoin’s volatility could cause the markets to react at the $10,500 support area in the near term.

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Joseph Young is a financial analyst based in South Korea. He has covered Bitcoin and the crypto market since 2013. He regularly contributes to the BTC Times, Forbes, and Cointelegraph.