Low DVOL Sparks Bitcoin Volatility Risk
Bitcoin volatility has re-emerged as prices recently retreated from record highs. The DVOL index, which tracks expected price swings, has plummeted to levels only seen 2.6% of the time, signaling an unusually calm market. In this backdrop, Bitcoin volatility may spike, as low DVOL readings often precede sharp moves.
Long-term holders (LTHs) have paused net position changes. Early-month purchases rose but then halted, and no significant selling pressure has emerged, reflecting cautious optimism among strategic investors.
Traders should monitor the $117,000 support level. A sustained hold could fuel a rally toward $120,000, while a breakdown below $112,526 may trigger bearish momentum. The suppressed DVOL invites risk managers to brace for sudden volatility surges.
Neutral
The report highlights historically low DVOL readings alongside stagnant long-term holder activity and key support tests. Low volatility readings typically precede significant price swings, but absence of heavy sell-offs and cautious accumulation by holders suggest neither clear bull nor bear momentum. Traders face a pivotal $117,000–$112,526 range: a hold above support could spur a bullish retracement, while a break below may trigger bearish cascades. Similar calm periods in 2020 and 2022 led to both upside breakouts and downside corrections. Given balanced technical signals, the immediate market outlook remains neutral, though volatility risk is elevated.