- This is what Glassnode
- The figure is only 3.4%
- This could indicate high volatility in the short term
The BTC trading range has narrowed to 3.4% according to Glassnode. Usually such market behavior indicates high volatility in the short term.
The trading range is the spread between the price highs and lows. It is often seen as an indicator of volatility. The narrowing of the range indicates an increase in momentum, and that carries a risk.
Glassnode notes that similar values were seen in June 2020 and in January 2023, just before the big market changes:
“That indicates high volatility in the short term,” says Glassnode.
The narrowing of the trading range indicates an increased chance of a border breakout.
However, it is unknown whether the trend will be negative or positive. Either way, it is highly likely to mean a “jolt” in the market.
Similar things happen in a scenario where competing narratives affect the pricing of an asset. That is, there is no clear prevalence of “bullish” or “bearish” signals in the segment.
Such factors include the banking crisis in the United States and the threat of default.
While the first narrative increases the demand for hedge assets and therefore their value, the second works the opposite.
While the first narrative increases the demand for hedge assets and therefore their value.