Bitcoin Price Battles for $27K as Bollinger Bands Reach Critical Zone

Bitcoin Could See Fresh Upside Volatility, Bollinger Bands Indicator Suggests

Bitcoin (BTC) may experience a surge in volatility as its price strength approaches key levels, according to a classic metric. John Bollinger, the creator of the Bollinger Bands volatility indicator, recently stated that Bitcoin is poised for a breakout decision.

After reaching new highs in September, Bitcoin is now testing resistance levels that have been out of reach since mid-August. This data comes from Cointelegraph Markets Pro and TradingView. Bollinger finds these signs from the largest cryptocurrency to be encouraging. Bollinger Bands use standard deviation around a simple moving average to determine likely price ranges and volatility.

Currently, BTC/USD is forming daily candles that touch the upper band. This occurrence can signal either a reversal back to the center band or an influx of upside volatility. The recent narrow Bollinger Bands seen on Bitcoin support the hope that the latter scenario will unfold. Bollinger commented on this, stating, “And there is the first tag of the upper Bollinger Band after a new set of controlling bars was established at the lower band. The question is now can we do a walk up the upper band? Too early to answer.”

This article previously reported on the narrowing of the bands in July, which ultimately led to a decrease in Bitcoin’s price.

Bollinger characterizes the current sentiment among experienced Bitcoin traders and analysts on short timeframes as cautious. Despite the strength seen this week, caution remains as various trendlines, which previously acted as support, are still above the spot price. Material Indicators, an on-chain monitoring resource, advised subscribers to question the momentum of the bulls. They stated, “We have heavy technical resistance overhead at the Key Moving Averages and support at the LL. It’s quite possible that we round trip the range, and with any luck, we will see legit tests of the R/S levels that will give us some clarity on where BTC goes from here before the end of the week.”

Material Indicators also referenced the upcoming decision on interest rates by the United States Federal Reserve, which could result in sudden volatility and unreliable short-term trading signals.

It is important to note that this article does not provide investment advice or recommendations. Readers should conduct their own research before making any investment or trading decisions.

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J-S Tremblay
About the author - J-S Tremblay

I've been involved in the cryptocurrency world since 2016 and trading since 2019. I started Moon and Lambo in 2021. I'm passionate about crypto and love to share my knowledge. I hate bankers and I hope that cryptocurrency will change the financial world for the better. View full profile...

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