-
Bitcoin has fallen back to $19,000 after strong job numbers.
-
Economist Alex Krüger says Bitcoin is flashing a key volatility index that precedes major moves.
-
Bitcoin trades at a support, and price action will depend on price data.
Bitcoin BTC/USD has flashed a key indicator that, historically, can predict explosive market moves. The views are according to renowned economist Alex Krüger. He has 146,200 followers on Twitter, making him one of the most followed economists. It is for this reason that his recent sentiments around Bitcoin draw attention.
Krüger has been monitoring the Bitcoin volatility index or BVOL. The index uses a weighted average price to measure Bitcoin’s volatility on a 30-day annualised basis. The economist says that a huge Bitcoin move happens each time BVOL closes below 25. With the key indicator flashing, Krüger expects a huge Bitcoin move.
The comments come when Bitcoin has slid back to below $19,500. The decline follows a job report last, which showed robust payrolls. The job report calls for faster Fed action, which slowed markets. The next in sight will be the inflation data on Thursday. Krüger says the consumer price index will spark the next wave of BTC’s volatility in either direction.
Bitcoin trades below the midpoint amid weak sentiment
Source – TradingView
On the technical side, Bitcoin trades at its psychological support of around $19,000. The bulls have defended the level for quite a while. However, an RSI reading below the midpoint shows there are more sellers.
Concluding thoughts
While the street sentiment is that Bitcoin is in a compelling buy zone, sentiment remains weak. Investors are also cautious ahead of the inflation data on Thursday. Bitcoin could oscillate around the support zone ahead of the CPI data. However, $19,000 remains an attractive zone, and a potential reversal is a possibility.