- Bitcoin is trading inside a tight range with its 10-day realized volatility dropping to a year-to-date low of 30 percent.
- Several analysts point to a lackluster sentiment in the market as Bitcoin repeatedly fails to continue its uptrend beyond $10,000.
- A period of low volatility mostly ends up in a price breakout in either direction. Macro fundamentals align in favor of bulls.
Bitcoin has been trading sideways in a tight price range since the beginning of May 2020. As a result, its 10-day volatility has now fallen to a new year-to-date low.
According to data provided by Skew, an on-chain analysis platform, the so-called BTCUSD realized volatility this week dipped to 30 percent. Also, the 30-day volatility declined to 57 percent, a pre-crash level. The chart below shows these developments precisely.
The Bitcoin price is fluctuating inside a trading range of $9,000 and $10,000 now for more than a month, data on TradingView.com shows. Looking at the tightened price moves through Bollinger Bands further implies a growing contraction in the cryptocurrency’s volatility.
Bitcoin price chart on TradingView.com showing its contracting Bollinger Bands. Source: TradingView.com
Readings on the Bollinger Bands Width, which represents current price volatility in numerically, is now near 0.08, its lowest since April 1. Observers see it as a sign of growing stress in the bitcoin market. Traders have switched their sentiment from adventurous to cautious.