Bitcoin Can Explode in Both Directions: It Has Only Been Seen a Few Times in 4 Years! - Coin Newsletter

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Bitcoin data seems to be approaching historical levels seen only a few times in the last 4 years, and the price looks like it could experience a burst in both directions at any moment.

According to data from on-chain analytics firm Glassnode**, Bitcoin's 1-week realized volatility is (realized volatility) and the implied volatility of 1-week options is (implied volatility) near historic lows. Historical data shows that similar volatility squeezes have resulted in large price movements.

According to Glassnode, Bitcoin's 1-week realized volatility dropped to 23.42%. In the last 4 years, it has only gone below this level a few times. For example, in October 2024, it was at 22.88% and in November 2023, it was at 21.35%. Historically, after such compressions, sharp price movements in Bitcoin occurred.

The implied volatility of Bitcoin's 1-week options has fallen to 37.39%, approaching multi-year lows. Similar levels were seen in 2023 and early 2024, followed by large increases in volatility in the Bitcoin market. Longer-term volatility data, on the other hand, suggests that bullish expectations are stronger**; The 3-month IV is 53.1%, and the 6-month IV is 56.25%.

This data suggests that Bitcoin's current narrowband movement could signal a major breakout. Similar low levels of volatility in the past have resulted in big rises or sharp declines.

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