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Taking a look at Bitcoin’s historic low volatility periods to find what 2023 holds

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Taking a look at Bitcoin's historic low volatility periods to find what 2023 holds

  • Volatility, or the lack of it, can serve as a tool for analyzing market trends
  • The downtrend of Bitcoin is mostly done, but one more leg downward could be painful

Bitcoin [BTC] investors have faced some difficult times throughout 2022. Investors and traders who witnessed the Celsius, Terra, and FTX crises (among so many other events) have seen history unfold before their eyes.

All of this history is laid bare on the price charts, and it is possible that we can prepare for the worst-case scenario by studying these charts. Look to the past to understand the future, as somebody famous probably once said.


Read Bitcoin’s [BTC] Price Prediction 2023-24


The periods when volatility vanishes are worth noting. For assets like Bitcoin, a fall in volatility often heralds a massive move around the corner. One of the simpler tools to measure how volatile an asset is on the price charts is the Bollinger Bands.

Bollinger Bands width indicator findings

Bollinger Bands is a tool developed by John Bollinger. It has two bands plotted with one standard deviation above and below the price (based on the past 20 periods). These bands adjust based on the volatility of the price of the underlying asset.

Here is what Bitcoin's volatility shows for the price action heading into 2023

Source: BTC/USDT on TradingView

When the Bollinger Bands’ width decreases, it indicates a period of lower volatility or contraction on the price charts. This generally highlights a period of accumulation before a strong move upwards, especially on higher timeframes. However, it can also indicate phases of distribution, before another move downward, once buyers are exhausted.

On the daily timeframe, the Bollinger Bands width indicator showed a reading of 0.09 at press time. It had receded to a low of 0.07 on 1 December and 0.06 on 25 October. Previously, the BB width indicator touched these values on the daily timeframe of 8 October, 2020.

Other dates in 2020, such as 26 August (0.07), 15 July (0.04), and 21 September, 2019 (0.06), also saw extremely low values registered.

Northward expansions followed reduced volatility

History does not repeat, but it does rhyme. All technical analysis is based on patterns that repeat themselves, over and over again. The October, August, and July contractions in 2020 came right before the recent bull run where Bitcoin ripped as high as $69k.

However, Bitcoin was in the depths of a bear market winter at the time of writing. Throughout 2023, Bitcoin might not embark on a strong higher timeframe trend, as was seen in late 2020 until mid-2021.

Therefore, there is the need to find points in time when volatility dried out after Bitcoin had retraced most of its gains from a bull run. This occurred in late 2018 and early 2019.

Here is what Bitcoin's volatility shows for the price action heading into 2023Here is what Bitcoin's volatility shows for the price action heading into 2023

Source: BTC/USDT on TradingView

The above chart showcases the late 2017 rally to $19.5k, and the subsequent retracement in 2018. During the downtrend, the volatility was nearly dead in September and October 2018.

The BB width indicator showed values of 0.08 and 0.09 consistently. However, another steep drop from $6k to $3,3k followed. From December 2018 to March 2019, the bulls fought for their lives to push prices back above $4.3k.

Finally, when this resistance was broken, a rally to $13k ensued. Hindsight tells us that this was not a true bull market rally. Still, it was an impressive move, north of 220% in under 90 days, once the $4.3k level was broken.

Therefore, the inference was that low volatility does not automatically translate into a long-term bottom. At the time of writing, Bitcoin has lost the $18.7k level, and another drop toward $10k could occur, just like it did back in late 2018.

Here is what Bitcoin's volatility shows for the price action heading into 2023Here is what Bitcoin's volatility shows for the price action heading into 2023

Source: BTC/USDT on TradingView

This rally reached a peak at $13.7k in June 2019 and receded in the months that followed. September 2019 saw volatility drop to 0.06, but it took until the COVID-19 crash before the markets found a long-term bottom and reversed.

Market structure breaks could be key to identifying rallies

Despite the bounce from $4.3k, BTC was not in a reversal. That took till the higher timeframe bearish market structure was broken, as highlighted in the chart above. A move back above $9k flipped the longer-term bias in favor of the bulls, and a breakout above the $10.5k level showed bullish strength.

What can we learn from this series of events? Compared to the present, the volatility has been low, and the trend has been downward, just like August – October 2018. From June – November 2018, the $6k level was rock-solid, until it wasn’t, and prices crashed another 46%. Can the same develop over 2023?

Here is what Bitcoin's volatility shows for the price action heading into 2023Here is what Bitcoin's volatility shows for the price action heading into 2023

Source: BTC/USDT on TradingView

Is the $18.7k level the line in the sand that $6k was back in 2018? $18.7k was defended as support from June – November 2018, for 144 days.

This was similar to the defense of $6k from June to November 2018, but the difference was that the $6k mark had already been tested as support as early as February 2018.

Now that $18.7k was lost, it was likely that more losses could follow. Long-term BTC bottoms tend to form abruptly after months of foreshadowing.

Another crash, like the one we saw during the outbreak of the coronavirus pandemic, or November 2018, would be necessary to force billions of dollars of liquidation before the markets can march upward.

Using Liquidation Levels Heatmap data from Hyblock, an anonymous analyst hypothesized on 29 December that $15k and $13k are the two major liquidation levels, with $50 billion worth of liquidation to be hunted in the vicinity of the $13k level.

The price seeks liquidity, and this area could be too juicy to leave unattended. A descent below $15.8k could see the already fearful market conditions ripen into a panic.

Forced sellers, both in the spot and futures markets, could cause prices to drop further and further, and end with a liquidation cascade.

Patience will likely be rewarded, but all-time highs are unlikely to be reached in 2023

In the event of a drop to $13k-$13.8k, buyers can await a move back above $15.8k and $17.6k and anticipate a rally, possibly a mirror of the one in mid-2019. As ever, it might not exactly replicate, and caution would be key.


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It was not certain or even necessary that $13k would mark the bottom. The heatmaps and the highs of the rally from mid-2019 show confluence at this level.

If, instead, BTC dumped another 46% beneath the $18.7k support, investors could look at $10k as a region where the bottom could form. Which way the die would roll was uncertain.

There were 641 days between Bitcoin’s breakdown beneath the $6k support level in late 2018 and the retest of $10.5k as support in Q3 2020. 641 days after November 10, 2022 gives us 12 August, 2024. However, each cycle is different, and all that a trader or investor can control is the risk they assume.

Laid out above is one scenario whose central theme is liquidity and volatility. When volatility goes on a holiday, so does liquidity. A large, violent move could be necessary to shake even the fanatics out of their positions.

Only then might the market reverse. In this game of shark eat shark, the patient and the prepared survive and profit.


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Cryptegrity DAO (ESCROW) is Now Available for Trading on Hotbit

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Cryptegrity DAO (ESCROW) is Now Available for Trading on Hotbit

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Hotbit Exchange, a global crypto trading platform, officially listed $ESCROW (Cryptegrity DAO) on January 27, 2023. The ESCROW/USDT trading pair is now available for all users of Hotbit Exchange.

To increase trust and protect the funds of buyers and sellers, Cryptegrity DAO (ESCROW) has introduced a means to trade crypto for goods and services without fear of theft or services not rendered, providing Security via smart contract technology. Its native token $ESCROW has been listed on Hotbit Exchange at 07:00 AM UTC on January 27, 2023, to expand its global reach further and maintain a secure and reliable platform for the exchange of goods and services using crypto.

INTRODUCING CRYPTEGRITY DAO

Cryptegrity is a blockchain-based platform that aims to increase trust between buyers and sellers of goods and services. The platform utilizes smart contract technology and cryptographic techniques to ensure transactions’ integrity and funds’ security. 

Cryptegrity’s web3 platform offers transparency and peace of mind that is impossible with traditional web2 competitors. Buyer funds are locked in an audited smart contract and released to the seller only when goods are received or services are rendered. This ensures that buyers and sellers can have confidence in the security of their transactions and reduces counterparty risk.

25% of revenue is distributed to $Escrow holders in real-time through smart contract technology. This revenue sharing continues for the lifespan of the platform or until all tokens are repurchased from public circulation. The Cryptegrity platform incentivizes the community and holders to help create liquidity and earn rewards by offering $Escrow for creating $Escrow LP pairs and staking them. Additionally, the Cryptegrity DAO rewards participants for contributing and resolving issues on the platform.

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In conclusion, Cryptegrity is an innovative platform changing our thoughts about online identity verification. With its cutting-edge technology, user-friendly interface, and listing on Hotbit, this project is poised to make a big impact in the industry.  

About $ESCROW Token

The Escrow Token serves dual purposes: it distributes platform fees to Token holders via revenue sharing and functions as a governance token with voting rights in the Cryptegrity DAO. It is the native token of the Cryptegrity Platform and is built on the Bep-20 and Erc-20 standards.

ESCROW has a total supply of 100 million tokens, with the following allocation: 10% to founders, 10% to the team, 10% for marketing and development, 10% for promotions, 10% for partnerships, 10% for liquidity for future DEX and CEX, and 40% available for sale to the public.

The ESCROW token is now available for trading on Hotbit Exchange starting at 07:00 AM UTC on January 27, 2023. Investors can easily buy and sell the token in relation to the Cryptegrity Project. The listing on Hotbit Exchange will aid in expanding the project’s reach and increasing market attention.

ABOUT HOTBIT

Founded in 2018 and holding Estonian MTR license, American MSB license, Australian AUSTRAC license, and Canadian MSB license, Hotbit cryptocurrency exchange is known as a leading trading platform that continues to develop and integrate various forms of businesses such as spot trading, financial derivatives, cryptocurrency investment and DAPP into one platform. Hotbit has already gained over 8 Million registered users from more than 210 countries and regions. Based on its globalized and unified strategies, Hotbit continues to focus on world’s emerging markets, such as Russia, Turkey and Southeast Asia markets and was ranked one of the top 3 most welcomed exchanges by Russian media in 2019. Hotbit is constantly introducing and listing high-quality crypto projects so its users can directly trade, manage, track, and analyze cryptocurrencies, making the entire experience easier for ordinary people.

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Centralized Exchange Tokens Post Solid Gains in January Despite SEC Interest; Bitcoin, Ether, in the Red.

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Centralized Exchange Tokens Post Solid Gains in January Despite SEC Interest; Bitcoin, Ether, in the Red.


“If demand for trading on the FTX platform increased, demand for the FTT token could increase, such that any price increase in FTT would benefit holders of FTT equally and in direct proportion to their FTT holdings,” the SEC wrote in its complaint. “The large allocation of tokens to FTX incentivized the FTX management team to take steps to attract more users onto the trading platform and, therefore, increase demand for, and increase the trading price of, the FTT token.”


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Australian Government Flagged FTX Concerns Eight Months Before Downfall

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Australian Government Flagged FTX Concerns Eight Months Before Downfall

A new report shows that the fallen crypto exchange FTX had already caused concerns with the Australian regulator months before its collapse. According to a document on The Guardian Australia’s website, the ASIC (Australian Securities and Investments Commission) started investigating the firm’s local operation last March.

An article in the Australian Financial Review prompted the concerns. The article outlined the now-bankrupt exchange’s plans to launch in Australia within a few weeks. FTX caused more concerns when rumors that it would allow users to purchase cryptocurrencies with margin loans of 30 times their investment started making rounds.

In early April 2022, several Australian regulators held meetings with FTX leadership, and at that time, the exchange promised to operate under the stipulated while cautioning its customers about potential scams. However, the regulators somehow remained concerned about the FTX business.

Report Shows ASIC Issued Several Notices to FTX Australia Within a Few Months

In a span of four months, the ASIC had issued about four notices to FTX’s Australian subsidiary, requesting more information about its business operations. However, to avoid interfering with its law enforcement activities, ASIC did not issue the notices via a freedom of information request.

The Guardian Australia’s briefing document released on November 12, 2022, a day after FTX had filed for bankruptcy, indicates that, indeed, the ASIC had been carrying out what’s described in the document as a ‘surveillance activity’ on the fallen exchange since last March.

The document stated that since March 2022, the Australian regulator has been requesting information from FTX Australia regarding its financial offerings. Among the issues raised included the firm’s compliance with the ASIC’s product intervention order alongside pricing and how it registered new users.

FTX Licensing Strategy

It has been discovered that FTX Australian began its operations without ASIC’s approval because it evaded the usual licensing procedures by buying out an existing firm that had possessed an Australian Financial Services License since 2021.

Another revelation shows that IFS Markets, the company acquired by FTX, had also gotten the license by taking over another financial firm called Forex Financial Services a few months earlier.


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