- The price of BTC has increased significantly over the past seven days
- As a result of an increase in activity, price volatility also begins to increase
Growing demand for Bitcoin [BTC] the past week has resulted in the crypto registering a 10% increase in value over the past seven days.
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During the intraday trading session on October 20, a 50% increase in trading volume helped push coin trading briefly above $29,000 for the first time since mid-August. Santiment revealed.
Source: Santiment
Indicators point to impending price fluctuations
An assessment of the activity of BTC’s short-term holdings (3-6 months) showed a significant increase in issued proceeds for investors within this age range on October 19. On that day, more than 125,000 dormant BTC coins changed addresses.
In fact, data has been retrieved from CryptoQuant showed that this represented the largest single movement of dormant coins for this investor cohort since May.
Source: CryptoQuant
The movement of these previously dormant coins is a sign that their holders were trying to take advantage of BTC’s price rise to book profits.
However, when a large number of previously dormant BTCs are issued at once, as on October 19, it typically signals a shift in market sentiment or strategy among holders.
These types of moves contribute to greater volatility in the BTC market, pseudonymous CryptoQuant analyst Mignolet noted in a recent publication. report. “We could see significant volatility soon,” the analyst said.
A review of some volatility marks on the coin’s daily chart confirmed the analyst’s view. For example, BTC’s Chaikin Volatility Indicator has been on an upward trend since October 15.
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This indicator measures the difference between the high and low prices of an asset over a given period of time. When the Chaikin Volatility Indicator rises to return higher values, it generally indicates large price movements and potential volatility.
This indicator stood at 32.77 at the time of writing, after an increase of 206% since October 15.
Similarly, BTC’s Average True Range (ATR) showed that volatility has been steadily rising over the past week. This indicator measures market volatility by calculating the average range between high and low prices over a certain number of periods.
Standing at 774.22 at the time of writing, the ATR highlighted the possibility of significant price swings in the coming days.
Finally, the coin’s Bollinger Bandwidth (BBW) has also grown over the past week, confirming the presence of volatility in the BTC market. At the time of writing, this indicator returned a value of 0.12, positioned in an uptrend.
Source: BTC/USD, TradingView