Bitcoin is showing early signs that it might be gearing up for a big move, as its volatility tightens a pattern that has historically paved the way for significant price swings.
As of now, Bitcoin is trading around $108,494, down slightly by 0.3% over the past 24 hours. Over the last week, prices have fluctuated between $105,430 and $110,307, leaving BTC just about 3% below its all-time high of $111,814 set in late May.
Technical analyst Axel Adler shared some interesting observations on July 8 via X. According to Adler, the Bollinger Bands on Bitcoin’s daily chart have narrowed significantly, with the gap between the upper and lower bands shrinking to just 7.7%. This represents one of the tightest ranges seen during the current bull market cycle.
Historically, these so-called “Bollinger Band squeezes” tend to signal that the market is winding up for a decisive move. Typically, prices break out in the direction of the prevailing trend which, in Bitcoin’s case, remains upward. Adler noted that there have been six notable squeezes in this cycle so far. Four of those were followed by immediate price increases, while the other two saw brief consolidations before continuing to climb. While a short-term pause is possible, history suggests the current squeeze could mark the start of Bitcoin’s next leg higher.
Adding to the optimism, the Bitcoin Mayer Multiple a valuation metric that measures how price compares to the 200-day moving average is sitting at 1.1x. That’s well within its neutral range of 0.8x to 1.5x, indicating Bitcoin is neither overbought nor historically expensive. Essentially, the market still appears primed for potential gains.
Market activity is also picking up steam. Bitcoin’s 24-hour trading volume has jumped to over $26 billion, a more than 34% increase from the previous day. Rising volume during periods of tight price action is often seen as a sign that traders are positioning for a breakout move.
On the technical front, Bitcoin remains comfortably above its 20-day simple moving average, while the Bollinger Bands keep squeezing tighter. The Relative Strength Index (RSI) is sitting at a neutral 55, suggesting there’s still room for price growth before the asset enters overbought territory. Although momentum has been somewhat flat, the combination of increasing volume and a tightening trading range tilts the outlook toward the bullish side.
If Bitcoin manages to break decisively above $110,300, it could test and potentially surpass its record high of $111,814. However, if prices slip below the 20-day moving average near $106,600, the market could see a deeper pullback toward the $102,000 level. For now, the technical signals and tightening volatility suggest that the bulls remain in control.
