What is up with the current cryptocurrency market?
Many of you, especially those traders among us, are noticing the almost serene quietness in the market. It's almost as if we're floating in space. Prices aren't going anywhere, and the traders are begging for something to happen so that they can ride those price waves again.
Look at the chart below. It was posted by my favorite technical analysis pirate Yarr showing the past 24 hours' price movement. Note that these figures are from Binance.
According to Yarr,
Volatility is necessary for day traders to as it gives more trading opportunities and profits can be made in a shorter period of time. The lower the volatility is the longer time is needed to get new trading opportunities and until the market reaches targets.
Volatility is set out as follows:
3% > is high volatility
1% - 3% is optimal volatility
0.90% > is low volatility
0.40% > very low volatility
This doesn't mean that low volatility in general is a bad thing but need to acknowledge that it requires more patience, good coordination with trades and awareness of the whole trend.
The why's and the how's.
Nobody can ever tell you why this is happening. But the experts can speculate and us lesser-educated can sure attempt to make sense out of this.
Any market goes through phases; cryptocurrencies is no exception. The plethora of factors in play is too much for any single person to comprehend. There is no general consensus among the experts on the current situation. The past year's bear market is sure to be a contributing factor. Regulation may be another. Further adoption and institutionalization can also cause this. What is for sure is that no one knows for sure, and that if you truly believe that cryptocurrencies on the blockchain is the future of finance you need to hold on tight.
Some believe that the market is now preparing for a bull-run. Those who are more pessimistic might even say that a further bear market is in play here. The market is preparing for something, but it won't reveal its secrets just yet.
Please comment below to let your thoughts be heard. I am always interested to hear what opinions the community has to offer.