Bollinger Bands Explained: Indicating Good Powerplay For Bitcoin in July 2023
Bollinger Bands are used very often to trade cryptocurrencies. In recent months Bollinger Bands have shown a great ease in identifying potential rallies and crashes in Bitcoin.
Bollinger Bands is a volatility indicator that shows whether a publicly traded financial asset like a cryptocurrency is overbought or oversold.
If the upper and lower bands are apart, it shows that the markets are highly volatile. Similarly bands that are close to each other signify low volatility.
Bands can expand in a highly volatile market and can contract in a market with low volatility.
The current market as of 18 July 2023 where Bitcoin has hovered near a price level of $30k, there is a possibility of a Bollinger Band Squeeze.
The current market condition is marked by low volatility because the gap between the bands is just 4.2% with respect to Bitcoin’s price as per Glassnode. We can also see that the price is near the bottom of the Bollinger Bands.