Cryptocurrency Market Turmoil

Few people realize what is happening in the cryptocurrency market these days, a statement that has often been true. However, it is also true that the market and its participants have not faced such turmoil in a long time.

On one hand, they say “buy the drawdown”; on the other hand, they insist we are already in a bear market and should abandon ship before it sinks completely.

Let’s refrain from making proactive predictions and simply react. Statistical tools and indicators like Bollinger Bands can provide assistance. Developed by John Bollinger, a legendary trader in financial markets, this indicator consists of a 23-day moving average and two deviations from it – one above and one below.

Looking at the daily time frame for a more solid analysis, we see that since the end of January, when Bitcoin’s price fell below the middle band, the main cryptocurrency has never returned above it.

However, following the volatility of the past few days, BTC’s price hit the lower band at $81,500 and has been rising since then. Despite testing this lower boundary, the middle curve remains untouched and is currently positioned at $92,200.

Considering recent trends, where even announcements like Bitcoin’s inclusion in the U.S. Strategic Reserve couldn’t advance the cryptocurrency beyond this middle curve, it’s reasonable to assume that BTC, now trading at $90,700, will find a stopping point around this level.