Bitcoin’s price action is showing similarities to August 2023, with on-chain data indicating that extreme volatility may be imminent. CryptoQuant’s research suggests that BTC/USD is “ready” for a significant move after a prolonged period of stagnation.
Choppiness Index Signals Incoming Volatility
Bitcoin has been trading within a narrow range with declining volumes, a setup that often precedes a major price movement. CryptoQuant contributor Percival highlighted the Choppiness Index, which currently sits at 62 on the daily chart and 72 on the weekly chart, indicating the need for a directional breakout.
“In 2023, before the uptrend, price cleared all traders of ‘boring’ positions in the opposite direction due to low volatility,” Percival noted. This suggests that another liquidity grab could be on the horizon before a decisive move.
Key Price Levels and Support Zones
Should BTC’s price follow a similar trajectory as August 2023, investors should watch critical support levels. The short-term holder (STH) cost basis at $92,000 is one area of interest, while the 200-day exponential moving average (EMA) at $85,000 serves as a key fallback level.
“The possibility of false moves before the bull run is strong, many breakout traders are positioned in these zones, and the sovereign market tends to blow up these positions and return to the expected course,” Percival concluded.
With traders bracing for a major shakeout, Bitcoin’s next move could define the trajectory of the broader crypto market in the coming months.
