Why Did Crypto Volatility Suddenly Disappear? 

The month of October, Bitcoin and Ether are showing less volatility indicating that the crypto market has reached its bottom? This is a major puzzle for everyone, especially HODlers who are hoping for a bullish market to return. This month is also called ‘Uptober’ among the crypto circles, for historically being a positive month in crypto. It has seen more streamlined movements across the crypto market, even though macroeconomic conditions remain the same. September is usually a bad month for crypto – maintaining downward trends for the past five years. However, October has usually been a recovery month or even a pump-up month for Bitcoin lovers. 

It was October last year, if you recall, when Bitcoin (BTC) reached its full glory at the all-time-high price of $61,374. Even though, since then, things have taken a dramatic turn with regards to a falling world economy and a lot of other factors leading to current price levels. 

Macro Perspective

U.S. stocks rose for the second day in a row on speculation that the Federal Reserve will ease its current hawkish monetary policies early next year.

Traditional Markets, the Dow Jones Industrial Average and the S&P 500 finished the day up 1.3% and 1.2%, respectively. The Nasdaq, which is heavily weighted toward technology, was up nearly a percentage point.

Commodities, Brent crude oil, a measure of energy markets, rose slightly to trade above $91 per barrel, down slightly from the previous week but still up more than 15% from the start of the year. Safe-haven gold fell 0.6% to $1,650 per ounce. 

Stocks and earning reports from Apple, Alphabet and other tech companies set to report. We will get to see the earnings this week.

Interest rate and the next rate hike by the Federal Reserve of the United States, weigh in and widely expected to be 75 basis point in the next two weeks.

For the products and goods, the Conference Board will release its October consumer confidence index on Tuesday, which is expected to fall and for housing starts and durable goods orders will be able to be scrutinized by the middle of the week. 

At crypto markets, the positive sign this October is that Bitcoin (BTC) has been moving in narrow ranges, and according to Bitcoin.com, Bitcoin shows less volatility compared to the Nasdaq and S&P 500. Have a look at the volatility index for Bitcoin. It is easy to see that the value of the index has declined over the last month, meaning that the price has more or less stayed out but does not change significantly.

source:  https://t3index.com/indices/bit-vol/

Currently, Bitcoin is trading at $19,278.85 (at the time of writing), staying above the $19,000 levels over the last few days. Only on the 21st of October, the coin had slipped below $18,500, recovering shortly after. 

Ether on the other hand has also maintained its $1,300 key level. Even though, mirroring the Bitcoin pattern, the coin slipped to $1,246 on 21st of October, the coin recovered too. Currently, trading at $1,346.94 (at the time of writing). The Ether Volatility Index also showed a downward trend, marking stability in prices. 

Source: https://t3index.com/indices/bit-vol/ 

To summarize past ten day’s coin performances, Ether (ETH) has gained about 1.56% while BTC lost a minor 0.8%. XRP showed a significant loss of about 6.24%. Among other popular coins, Polygon’s MATIC has gained over 5.77%. The lack of trading volume in the crypto markets is the most significant contributing factor to the lower volatility of the crypto markets. 

source: coin360.com 


Please note that this is not trading advice. We recommend you to carry out your own research before making any trading decisions. This article is for informational purposes only.

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