Despite being extremely volatile when compared to traditional asset classes, bitcoin (BTC) maintains a market equilibrium nature for the majority of the time, according to arecent report by cryptocurrency research firm Zubr.<\/p>\n
The report emerged just a few days after bitcoin rallied beyond the $12,000 mark and its volatility finallyrecovered from a multi-year low, Cointelegraph reports.<\/p>\n
Using data from CoinAPI, a cryptocurrency market data provider, Zubr found that bitcoin price swings are typically accompanied by nearly symmetrical movements on the opposite side, creating opportunities both on the positive and negative side.<\/p>\n
According to Zubr: The majority of the time, Bitcoin will almost mimic the exact percentage increase with a percentage decrease on the very same day.<\/p>\n
Typically, this mirror effect takes place within the same trading day, but Zubr also found that it can also occur over the course of longer time periods.<\/p>\n
This means that over the short term, bitcoins recent rally to $12,000 could see a similar return to the $10,000 levels and a number of otherfactors point to the possibility of this pullback.<\/p>\n
Developing a better awareness of market equilibrium and its relation to bitcoins price can be extremely insightful when incorporated into a day-trading strategy, especially considering that the volatility phenomenon discussed earlier has been constant since 2017.<\/p>\n
Traders can ride the volatility and gain from both shorting and longing bitcoin on a daily basis. However, this is only one of the many things traders should have in mind.<\/p>\n
According to Zubr: What the data is effectively indicating is lower risk opportunities are possible if one is to trust the historical events and deem such a swing intrinsic to bitcoins trading character. For example, should bitcoin increase by 10% and retreat back to its opening price, history indicates that there is an overwhelming chance (over 50%) that the price drops between 9-12% within the same day or following day.<\/p>\n
While inconclusive on its own, this data point can be used when composing a strategy for intraday and momentum trading styles.<\/p>\n
In the meantime, only time will tell if Bitcoin will maintain its current market equilibrium or continue higher above the $12K mark.<\/p>\n
Asia Times Financialis now live. Linking accurate news, insightful analysis and local knowledge with the ATF China Bond 50 Index, the world'sfirst benchmark cross sector Chinese Bond Indices.Read ATFnow.<\/p>\n
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Bitcoin will drop to $10K before rally resumes - Asia Times<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" Despite being extremely volatile when compared to traditional asset classes, bitcoin (BTC) maintains a market equilibrium nature for the majority of the time, according to arecent report by cryptocurrency research firm Zubr. The report emerged just a few days after bitcoin rallied beyond the $12,000 mark and its volatility finallyrecovered from a multi-year low, Cointelegraph reports Continue reading