Bitcoin’s consolidation pattern has finally ended; with a bang, but probably not the bang most people were expecting. The journey to the bottom seems to have held on as the price has started to consolidate yet again. This sudden and dramatic move by Bitcoin has caught a few off-guard however, and at times like these it is better to act rationally. More precisely, it is time to zoom out.
Looking at Bitcoin on a macro scale shows that not a lot has changed, even with a drop of 20%. It is still performing better than most traditional assets out there. This is yet another confirmation of the fact that volatility is an inherent factor with Bitcoin, and not a byproduct.
The 30-day volatility index for Bitcoin shows that it has been reducing constantly since July, with the reduction becoming prominent after it hit a temporary peak in mid-July 2019. A longer timeframe shows that cycles of peak volatility are followed by periods of low volatility and vice versa. The last time volatility reached a low below 2% was in mid-March, which was followed by an explosion in volatility and concurrently, the price did start hitting higher highs and going parabolic starting in April.