Key Points
- Bitcoin’s spent outputs hint at possible price swing, as per CryptoQuant’s data.
- Despite this, key volatility markers on daily chart suggest minimal risk of significant short-term price swings.
Bitcoin’s Spent Outputs Indicate Potential Price Swing
Bitcoin’s spent outputs for investors holding their coins between one to twelve months have seen an increase. This could suggest a potential price swing, according to data from CryptoQuant. These spent outputs provide insights into the spending behavior of different age bands of investors. For instance, it can identify if coins held by short-term holders are being moved, which could indicate an increase in profit-taking activity.
When the amount of spent output for short-term Bitcoin holders rises, it often points to a surge in market volatility. CryptoQuant analyst Mignolet stated, “Movement of this entity can be seen as data for volatility confirmation rather than for price increases or decreases. It appears that volatility is likely to emerge soon.”
Volatility Markers Suggest Minimal Risk
However, an analysis of the coin’s key volatility indicators on a daily chart suggested a minimal risk of any significant short-term price swings. The Bitcoin’s Average True Range (ATR) showed a steady decline since the 19th of April. This indicator measures the average range of price movements over a specified period. A decrease in ATR indicates a reduction in market volatility.
Similarly, Bitcoin’s Chaikin Volatility was observed to be in a downtrend. Since the 19th of April, the value of this indicator has dropped by 162%. This indicator measures an asset’s price volatility by comparing the current range between the high and low prices to a previous range over a specific period. A decline suggests that the market is becoming less volatile as the range between its high and low prices is contracting.
Furthermore, Bitcoin’s flat Bollinger Bandwidth (BBW) supported the low volatility in the coin’s market. When an asset has a flat BBW, it suggests that its price is experiencing low volatility and its movements are relatively stable and confined to a narrow range.
At the time of writing, the leading crypto asset, Bitcoin, was valued at $64,241. According to CoinMarketCap’s data, its value has climbed by 5% in the past seven days.
