Analyst Warns: Bitcoin Price Surge Above $26,000 Could Trigger Volatility Eruption

- Advertisement -

After experiencing a sharp decline from $19,700 last week, bitcoin (BTC) found support at its 200-day moving average (MA). This support helped the largest cryptocurrency by market cap to rally and surpass the previous resistance at $25,200.

After a month of volatility, bitcoin is currently trading at $26,300 in an uptrend. The 200-day moving average (MA) is providing a strong support level, suggesting that BTC could be set to scale new yearly highs and reach the $30,000 level. However, this rally could be coupled with high volatility.

early stages of a bull market

- Advertisement -

“JJ the Janitor,” an analyst on the Jarvis Lab team think over The $19,700 level is where bitcoin bottomed last week, as indicated by the 200-day MA, to be a key indicator to determine BTC’s current trend. He mentioned:

The fact that it was tested and held may confirm a thesis we’ve been sharing all year: this is the beginning phase of a new bull rally, not the latter phase of a bear rally.

The analyst believes that in the early stages of a bull market, prices will eventually reach a point where they become overvalued, triggering a chain reaction of liquidation of “long open interest”. This liquidation could be a cascade as BTC reaches the $30,000 level.

- Advertisement -

In a future liquidation cascade, the price could drop towards important support levels, such as the 200-day EMA, which will continue to rise as BTC price rises.

bitcoin natural state of high volatility

While bitcoin price is currently above the 200-week MA, for the analyst, this represents a short-term win as, as it holds this line, BTC has no “overhead” resistance for the first time since 2021. Will not done.

bitcoin volatility score breakout Source: Jarvis Labs

As seen in the chart above, Bitcoin’s volatility score, represented by the blue line, is breaking out of its 7-month range and recently touched its 200-day DMA (red line) at 26.13. has crossed. This suggests that BTC will soon break out of the $15,000-$25,000 range.

Bitcoin historically rallies after breaking above the 200-day MA. Source: Jarvis Labs

As depicted in the chart above, there was a significant increase in both volatility and price action from late 2020 to early 2021. During this period bitcoin broke the 200-day MA and surged from $15,500 to $58,000 in just four months. This shows the potential for BTC to generate significant upside momentum in the coming months. The analyst concluded:

Consider the volatility we experienced in early March foreshadowing what’s to come. We now find ourselves in a brave new world, a world for which BTC was uniquely designed.

This week, the cryptocurrency market has seen significant volatility. Although bitcoin has crossed the $26,000 mark, bears are hopeful of a return to previous lows, while bulls are optimistic as there is currently no major resistance above $26,000.

Bitcoin continues to post significant gains across all time frames. Currently trading at $26,300, BTC is up 5.9% in the last 24 hours and 30% in the last seven days.

Bitcoin continues to rally on the 1-day chart. Source: BTCUSDT on

Credit :

- Advertisement -

Recent Articles

Related Stories