The Bollinger Bands indicator, created by John Bollinger, suggests that Bitcoin (BTC) could experience fresh upside volatility, potentially leading to a breakout. This conclusion comes after Bitcoin recently hit new highs for September and challenged resistance levels not seen since mid-August.
The Bollinger Bands indicator uses standard deviation around a simple moving average to determine potential price ranges and volatility. When the daily candles for BTC/USD touch the upper band of the Bollinger Bands, it can signal either an imminent reversal back to the center band or the possibility of increased upside volatility.
The recent narrowing of the Bollinger Bands for Bitcoin suggests that the latter scenario, an increase in upside volatility, may be more likely.
Bollinger Bands Indicator Points to Potential Bitcoin (BTC) Breakout
Despite the recent strength in Bitcoin’s price, some caution remains in the market, as various trendlines that previously acted as support are still above the current spot price. Additionally, traders are keeping an eye on the upcoming decision by the United States Federal Reserve regarding interest rates, which could introduce sudden volatility and potentially unreliable short-term trading signals.
Please note that this article does not provide investment advice or recommendations, and readers should conduct their own research before making investment decisions.