Technical indicators suggest that Bitcoin may be on the brink of a significant price change. Traders point to the tightening of Bollinger Bands on the monthly chart, indicating possible increases in volatility.
Volatility Forecasts
Crypto analyst Matthew Hyland noted that Bitcoin’s monthly Bollinger Bands have reached their tightest level since its inception in 2009. Analyst Crypto Ceasar added: "The Bitcoin Bollinger Bands on the 1M are at historical tightness." This suggests potential upward volatility, and Bitcoin might expect a "spicy fourth quarter."
Previous Price Movements
Investor Giannis Andreou remarked that similar contractions in 2012, 2016, and 2020 all preceded explosive price expansions. He noted that the current setup is even tighter, suggesting the potential for Bitcoin’s largest move ever. Additionally, in July, a squeeze on the three-day chart predicted Bitcoin’s run to record highs above $124,500 in mid-August.
Supporting Factors for Growth
Macroeconomic and institutional dynamics are also supporting bullish forecasts. Impending Federal Reserve interest rate cuts, combined with strong inflows into spot Bitcoin ETFs, are reinforcing confidence. Analysts from Santiment reported: "Money is moving back into Bitcoin ETFs at a rapid rate as retailers impatiently drop out of crypto." Meanwhile, on-chain metrics remain strong, and some traders believe Bitcoin could mirror gold’s historical surges.
Despite the current correction, analysts see a possible short-term bottom around $104,000 before another upward move. It should be noted that not all patterns deliver their full upside; research from Thomas Bulkowski found that only 61% of cup-and-handle setups reach projected targets.
