Bitcoin Volatility Hits Historic Lows Before June 7 Decline

Bitcoin experienced remarkably low volatility in the 15 days leading up to June 7, approaching historic lows for such periods in its history. The cryptocurrency’s price movement was minimal, indicating a rare calm before the market shift.

Bitcoin Sees a Period of Low Volatility

From May 24 to June 7, Bitcoin’s price remained within a narrow range, trading between $66,936 and $71,656. This period was marked by exceptionally low volatility, falling into the “bottom 6% of occurrences” for 15-day volatility in Bitcoin’s history, according to Rapha Zagury, chief investment officer at Swan Bitcoin. 

“The horizontal blue line is the latest 15-day rolling volatility number of 23%. It certainly looks close to the lower level,” Zagury noted in a June 7 post on X, highlighting how Bitcoin was “stuck in a range.”

Sharp Decline on June 7

Following this period of low volatility, Bitcoin’s price dropped sharply by 3.33% to $69,264 on June 7, as per CoinMarketCap data. This decline was triggered by the release of the United States Employment Situation Summary Report, which showed stronger-than-expected job growth. 

The report suggested that the U.S. Federal Reserve might not cut inflation rates on June 11, a metric closely watched by analysts for Bitcoin price predictions.

Bitcoin Historical Patterns and Future Speculations

At the time of publication, Bitcoin was trading at $69,335. Zagury pointed out that historically, periods of similarly low volatility have led to significant price movements. He highlighted that following such low volatility periods, Bitcoin’s average return over the next 30 days stood at 20.95%. However, the returns varied widely, with the minimum return declining by 32.06% and the maximum reaching 218.40%.

Looking at a longer timeframe, the outcomes were even more pronounced. Over the course of 365 days following previous low volatility periods, the minimum return was 55.59%, while the average return soared to 820.82%. Zagury emphasized that while past performance is not indicative of future results, there is “value in learning from the past.”

Market Implications

The recent low volatility in Bitcoin suggests a period of consolidation, often a precursor to significant price movements. The sharp decline on June 7 underscores the market’s sensitivity to macroeconomic indicators, such as job growth and inflation rates. Analysts and investors closely monitor these indicators to predict future price movements.

Bitcoin’s minimal price movement over the 15 days leading up to June 7 marks a notable period of low volatility, almost unprecedented in its history.