Bitcoin Volatility Hits 2-Year Lows: Is a Major Price Move Brewing?

Bitcoin's recent price action has been characterized by low volatility, but according to crypto analyst Axel Adler Jr., this calm may be followed by a storm. On August 10, the U.S. spot Bitcoin ETF flows measured negative $144.6 million, breaking a streak of positive flows that had brought in $865.3 million over five consecutive trading days.

The price of Bitcoin was also down just over 3% from Sunday's local high at $65,474, which is within the key supply zone of $65k-$67k. The inability to climb past this barrier hints at bearish control in the market.

Axel Adler Jr. uses the Bollinger Bands metric to measure volatility, and according to him, the current width of 3.8% is one of the lowest readings in two years. This sharp compression often precedes a violent expansion in volatility, which could lead to a strong price move.

Another indicator, ADX, measures market strength and currently scores at 11, well below the threshold of 25 that signals a strong trend. The lack of direction and compressed volatility are warning signs for market participants.