Time to Pay Attention: Bitcoin Reaches ‘Logical’ Level
Bitcoin price is experiencing one of the more significant corrections since the trend started to change direction.
According to the creator of Bollinger Bands, it is once again “time to pay attention” – this time because BTCUSD has pulled back to a “logical” level.
Bitcoin is starting to pull back to logical level
Bitcoin reached almost double its current market lows, almost convincing the crypto community that a new bullish trend had begun. With BTCUSD now down more than 10% from local highs, fear is already back in the air in a big way.
Bulls are now almost silent, having recently declared that the bull market has returned. Bears are already celebrating the correction as a continuation of the ongoing bearish trend.
More tactical technicians, such as John Bollinger, simply believe it is “time to pay attention” and have yet to take a side. The quote has become somewhat of a catchphrase for the creator of Bollinger Bands. But what exactly is he talking about?
The creator of the Bollinger Bands has spoken | BTCUSD on TradingView.com
All about Bollinger Bands
Bollinger Bands is a tool for measuring volatility. The tool’s creator recently pointed out an expansion after a longer phase or narrowing. This behavior is referred to as a “squeeze” and suggests that an increase in volatility is in store. That is precisely what we are witnessing now.
Volatility is a measure of price spread over a time frame, and after very little movement BTCUSD is like a rollercoaster again. Ups and downs are par for the course.
Bollinger Bands consist of a 20-period simple moving average (SMA), which price retreated to and has now broken below. The upper and lower bands are set to two standard deviations of the SMA.
The next logical level to look for support would be the lower band, which is around $27,000. Once Bitcoin reaches that level, it may continue downwards with strength or snap back to the top of the band.
One thing is for sure, the tool that predicts volatility was accurate. Now is the time to pay attention.
As a journalist, I often cover the best conversations from the best in the industry.
As a trader, I never forget the corresponding price action so I can learn at every turn.
Same vibes. Pay attention. pic.twitter.com/cbpjaK9Ntd
— Tony “The Bull” (@tonythebullBTC) 20 April 2023
