- The Blockchain Breakthrough
- Posts
- Is all the bearishness waranted?
Hey everyone,
This week, I wanted to highlight a useful metric that many professional investors keep a close eye on: volatility.
Generally, lower volatility tends to be more bullish, while higher volatility can signal bearish trends. This is a well-known concept in the stock market, where the VIX index is commonly used to gauge market volatility.
Question is…does this work for crypto as well? I ended up looking into this after hearing Raoul Pal from Real Vision discuss this.
Let's take Bitcoin as an example. Check out the chart below, which shows Bitcoin's price (orange line) and its volatility (blue line).
Some questions to ask yourself as you look at the chart:
Each time Bitcoin's volatility fell to around 20 (green horizontal line), what happened to the price afterward?
Where is Bitcoin's volatility now?
Understanding these patterns can give you valuable insights into potential future movements.
Cheers,
Justin
P.S. puppy update. It’s incredible how fast they grow. She’s already doubled in size over a bit more than a month.
Want to show everyone you’re a crypto investing pro?
Investing pro’s need top tier market intelligence…and you can get that in this premium newsletter.
In this plan we tell you whether we’re buying, selling, or doing nothing with our crypto. Investing isn’t ever 100% sure, but the way we do things has worked over time.
It has helped us:
Buy near the bottom last cycle
Sell within 10% of the top last cycle
We also explain how we decided to buy, sell, or do nothing— we show our work, just like in math class.
If you have any thoughts, feedback, or topics you’d like us to cover - feel free to respond to this email. Don’t worry, your response will only go to us not everyone that subscribes to the newsletter
Visit our website to see all prior articles:
Disclaimer: The Blockchain Breakthrough is not financial advice. Please do your own research.
Reply