Surprise price increase did not last today and BTC dropped below $29,500 again. Moreover, US exchanges opened lower. When macro data is positive, Bitcoin does not rise but experiences rapid losses when it is negative. This indicates a significant decrease in risk appetite among investors. Popular economist Alex sheds light on the current situation.
Bitcoin Analysis by Economists
Economist and crypto trader Alex Krüger says that an overlooked indicator gives bullish signals for the Bitcoin price. Krüger states that BTC’s realized volatility has reached the lowest level seen in the last three years.
“BTC’s realized volatility has not been this low since July 2020. This chart highlights periods where volatility reached 25% or lower since 2015.”
According to the chart, Bitcoin’s realized volatility has reached 25% or lower levels ten times since 2015. In most of these cases, Bitcoin later moved upwards. If the analyst is correct, this situation could mean an uptrend for cryptocurrencies in general.
Expert Opinion on Cryptocurrencies
Expectations for the global economy are not good for the end of the year. The Fed continues its tight monetary policy until it reaches its inflation target. In addition, recent data indicates both a recession and the continuation of Fed tightening. Both economic slowdown and tight monetary policy have negative consequences for Bitcoin.
So what does Alex say? The economist previously mentioned that the approval of BlackRock’s spot BTC exchange-traded fund (ETF) application has not fully priced in the crypto market. If approved, he says that the crypto markets are likely to rise significantly.
He also said that he closely watched the range of $31,000 to $37,000, which he believed was a liquidity gap caused by the fragmentation of the Terra ecosystem last year. If Bitcoin convincingly enters this range, it can make a major rally.
“We are right on the threshold of a breakthrough. Once it breaks, it should keep running.”
For now, the BTC price is far from the optimism of the famous economist, standing at $29,300.
