San Francisco-based digital asset exchange Kraken has released a report for its top traders to the public, which predicts Bitcoin may be at the start of a major bull run.
The document highlights the fact that the crypto king has finally broken out of a large pennant pattern that has kept bears in control since the latter part of 2017. According to the crypto exchange, the breakout could indicate the start of a new bull cycle as Bitcoin surges above $10,500 and prints a higher high from a macro perspective.
The exchange notes the fact that BTC’s annualized volatility fell to 23% on July 24th. The report stresses that every time Bitcoin’s annualized volatility falls between 15% – 30%, which Kraken refers to as the “suppressed pocket,” sharp moves to the upside typically follow.
Kraken says Bitcoin’s price history “seems to suggest that the late-July jump in volatility is merely the start of what is likely to be a new uptrend.” The firm predicts Bitcoin’s volatility could soon rise above 100% as BTC “rallies somewhere between +50% and +200%” in the coming months.
“Of the 12 instances where annualized volatility bottomed between 15% and 30%, volatility has, on average, bottomed at 21% before climbing higher over the next three months (94 days) and topping out at 140%.
Only on two occasions has Bitcoin posted a negative return from volatility trough-to-peak; on average, Bitcoin returns +196%…
Although momentum appears to be on the side of the bulls, Kraken cautions that wild price swings are likely on the horizon.
“With Bitcoin having only traded above $11,000 for 91 of its 3,636 days of trading (2.5% of its life), we anticipate volatility to build as Bitcoin unlocks new levels of support and resistance and navigates through uncharted waters.”
You can read the full report here.
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any losses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Featured Image: Shutterstock/Tithi Luadthong
