Bitcoin Stuck in a Tight Range: Will BTC Relieve the Pressure with a Big Move?

The data shows that bitcoin has recently been stuck in a historically tight 14-day range, something that has disintegrated into larger moves in the past.

Bitcoin’s 14-day range has become extremely narrow recently

According to data from analytics firm glassnodeThe 14-day range has only been narrower than it is now, at less than 2% of the cryptocurrency’s entire trading life. The “14-day range” here refers to the percentage difference between the top and bottom recorded in the price of bitcoin over the past two weeks.

This indicator can tell us how volatile the asset’s price has been recently. When its value is high, it means that the coin has seen a large amount of volatility within the last fourteen days, and thus, has recorded high volatility in the price.

On the other hand, the low values ​​of the metric mean that the cryptocurrency has not been as volatile as its price has only increased by a small percentage during the past few weeks.

Now, here’s a chart that shows the trend in bitcoin’s 14-day range over the entire history of the asset:

Looks like the value of the metric has been quite low in recent days | Source: Glassnode on Twitter

As shown in the graph above, Bitcoin’s 14-day range is currently only 4.6% up in value, meaning there is only a 4.6% difference between the local high and low over the past two weeks.

This is a very low value compared to what has generally been the norm for BTC. In the chart, Glassnode has also marked instances where the indicator has seen even lower values ​​than it has now.

As can be seen from the purple bars, there have been very few instances where bitcoin has traded inside a narrow range. In numbers, the metric recorded a low of only 2,176 hours over the asset’s lifetime, which equates to roughly 1.9% of the oldest cryptocurrency’s entire trading lifetime.

Historically an interesting pattern has been followed whenever the indicator has recorded such low values ​​of the 14-day range. From the graph, it is visible that bitcoin usually succeeds with a violent move during this period of extremely low volatility.

This violent move can be in either direction, as both crashes and rallies follow a narrow range. However, interestingly, most of these moves have been to the upside.

The latest occurrence of this pattern occurred in January, just before the current rally began. It appears that even at that point, the tight range began to rapidly move upward.

If we look at history, the current low values ​​on the 14-day range could mean that another bullish move is likely for bitcoin in the near future. And naturally, such moves are more likely to be in the upward direction, if considered a priority.

btc price

At the time of writing, bitcoin is trading around $30,900, up 1% over the past week.

BTC appears to be surging | Source: BTCUSD on TradingView

Featured Image by Andre Francois McKenzie on Unsplash.com, Charts from Tradingview.com, Glassnode.com