The Bitcoin price continues to consolidate, as we call it so beautifully in the financial world, around the all-time high of 2017. The magical USD 20,000 limit remains an important piece of war zone where the bulls and the bears continue to meet. However, according to Twitter analyst Matthew Hyland, this won’t be long and we can expect a significant price movement soon.
Up or down?
The big question is, of course, which way we are going with this huge price movement. Unfortunately Matthew Hyland can’t give us the answer to that question either. If we take a look at all the macroeconomic conditions, a downward price movement seems the most logical option, but with Bitcoin you never know. What we do know is that Bitcoin’s so-called Bollinger Bands have not been as tight since late 2020 as they are today.
We all know what Bitcoin did at the end of 2020, so in that sense it could have a positive effect on the price. At the time, the price exploded and Bitcoin entered the bull market that eventually resulted in the preliminary all-time high of $69,000. The reactions to Hyland are not exactly positive. Hyland has made a few wrong predictions in a row and is now mainly the butt of ridicule.
What are the Bollinger Bands?
The Bollinger Bands that you regularly see with technical analysts are two lines that are based on the moving average of an asset. Then the top line of the Bollinger Bands forms by adding two standard deviations to that line and the bottom line by subtracting two standard deviations. What you often see is that the Bollinger Bands act as support and resistance lines.
The closer the Bollinger Bands creep together, the tighter they become, the lower the volatility of an asset. On the other hand, you often see an asset explode when the Bollinger Bands tighten. Bitcoin’s Bollinger Bands are currently tightening significantly, leading analyst Matthew Hyland to expect a price explosion or implosion. Unfortunately, only time can tell what it will be.