Continuation Or Correction: What Bitcoin “Real Volume” Says About The Current Uptrend

Continuation Or Correction: What Bitcoin “Real Volume” Says About The Current Uptrend

Bitcoin broke properly above $20,000 this week, signaling that the bull market was actual and that the cryptocurrency was more likely to go parabolic within the very close to time period if it hasn’t already.

The breakout was supported by the very best “Real Volume” because the June 2019 excessive. High quantity throughout a breakout is an indication that the surge is actual, and backed by consumers. However, as a result of “Real Volume” has up to now solely reached such factors throughout reversals, it may be an ominous signal {that a} correction is coming. Which is it, and what else can quantity inform us in regards to the at present trending cryptocurrency?

Bitcoin Real Volume Reaches Highest Peak Since June 2019 High

Bitcoin this week broke above $20,000 and in a flash discovered itself at a excessive of $23,750 earlier than taking a breather. The breakout of the important thing resistance stage and a clear clearing of $20,000 was a sign that the crypto bull market was again, and a surge in quantity arrived to help the transfer.

The highly effective burst of shopping for and promoting with loads of BTC exchanging arms induced a climax in Bitcoin “Real Volume” that’s the very best because the June 2019 excessive.

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Back then, the cryptocurrency surged to $13,800. The subsequent highest stage of “Real Volume” got here throughout the Black Thursday collapse, when Bitcoin as soon as once more bottomed below $4,000.

From the excessive of $13,800 to the low of $3,850 was roughly a $9,950 fall. From the $3,850 low in 2020 to the present peak of $23,750, was a $19,900 swing. Interestingly, that’s precisely double the size of the $9,950 drop to retest bear market backside resistance turned help.

But that’s not the one correlation. Each of those main swings noticed a large surge in Bitcoin “Real Volume” and to this point, every occasion except for the present rally resulted in a reversal instantly after.

“Real Volume” is a software developed by Bitcoin knowledgeable Charles Edwards designed to filter out the entire “pretend” quantity on websites like CoinMarketCap. Edwards additionally created the Hash Ribbons and different basic instruments.

Bitcoin Real Volume reached the very best since 2019’s peak | Source: BTCUSD on

Crypto Turned To Max: What Real Volume And VPVR Could Indicate

Could this spike “Real Volume” really be a reversal disguised as a breakout? Breakouts are additionally supported by such quantity, so the correlation isn’t conclusive.

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But quantity may be a particularly useful technical indicator, relied on by practically all merchants and analysts price their salt. Volume precedes worth, because the saying goes.

Another manner to take a look at quantity is through the use of the Volume Profile Visible Range (VPVR). An outline of the software explains that it “shows buying and selling exercise over a specified interval and plots a histogram on the chart which reveals dominant and important worth ranges based mostly on quantity and in essence provides a transparent indication of Supply or demand at a sure worth relatively than quantity in a sure interval.”

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The most important piece of the quantity profile puzzle is known as the “level of management,” which represents the value stage at which essentially the most buying and selling motion passed off, as measured by quantity inside a selected interval. The level of management between 2019 to right now, lies round $9,200 the place there’s a CME hole ready to be crammed.

This stage is very essential, because it outlines the place the first provide and demand wrestle level passed off, and the place the equilibrium maintaining Bitcoin in a bear market had been lastly damaged.

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It is essential to notice, that it isn’t unusual for property to retest a significant level of management earlier than transferring increased. The level of management modifications relying on the timeframe, and when zooming out additional to take a lot of the bear market into consideration, the Black Thursday selloff was really a completely predictable retest of the “creating level of management,” in line with the VPVR indicator.

bitcoinm real volume reversal VRPR

The Black Thursday collapse was stopped on the level of management  | Source: BTCUSD on

Another level of management retest might take the cryptocurrency again to retest below $10,000 which might be stunning to anybody who witnessed this 12 months’s rally, and act as fairly the shakeout.

But it additionally might be wholesome, and like Black Thursday, be a sign to the market that it’s time to go away that time of management behind, and let one other one develop. With little or no worth motion above $10,000 and the purpose of management tapped for the final time, worth discovery can totally start.

Featured picture from Deposit Photos, Charts from


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