2020-4-15 14:15 |
After experiencing record volatility in March, Bitcoin’s realized volatility has reverted back to normal levels — suggesting that the worst may not be behind the first and foremost cryptocurrency.
The cryptocurrency markets have been calmer as of late. Realized volatility on the BTC/USD trading pair saw wild swings last month. On March 12, in particular, some -50 percent of the entire cryptocurrency market was wiped out in a historic drop.
However, things appear to be calming down. As skew (@skewdotcom) reports on Twitter, realized volatility continues to decline.
Bitcoin realized volatility has already reverted pic.twitter.com/vQ0KAq5Che
— skew (@skewdotcom) April 14, 2020
As the chart from skew shows, Bitcoin has never seen such extreme volatility as it did in March. It is a positive sign that the cryptocurrency market may be returning back to normal levels.
However, Bitcoin options markets have not yet returned to the volatility seen before March. In a follow-up tweet, skew shows that volatility continues to be high but is on the decline.
Bitcoin futures markets continue to be volatile.
After the wild swings in March, the cryptocurrency market seems to have found some short-term stability in early April. How the coming few months will play out, however, depends on macroeconomic indicators. The S&P 500 has been closely correlated with Bitcoin, especially in the last few months.
Many traders are betting that Bitcoin’s block-reward halving event will provide some bullish momentum in the coming months. Currently, Bitcoin’s Relative Strength Index (RSI) has never been this low before a halving event. This may indicate that it is exceptionally oversold and seems to suggest that BTC is very near its local bottom.
Bitcoin dominance chart courtesy of CoinMarketCap.com.For now, the rest of the cryptocurrency market is closely following Bitcoin’s price movements. Once again, the first and foremost coin is leading and the rest of the cryptocurrency market is merely shadowing it.
However, Bitcoin’s price movements are also being heavily dictated by macroeconomic trends — so traders should keep an eye on greater economic forecasts to gauge future Bitcoin trades.
The post Bitcoin’s Realized Volatility Falls Back to Normal Levels After March Bloodbath appeared first on BeInCrypto.
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