Is Bitcoin Headed For Significant Volatility In The Coming Months?

According to Jack F. Cahn, technical analyst Jack F. Cahn’s proprietary model, the world’s most popular digital currency could experience volatility in the coming months.

Technical Event Model (TEM), which he created in-house, measures extremes of sentiment. It is a price-based macro filter to help algorithmic trading programs forecast when market dynamics will change and what to expect.

This model was created to indicate whether the market is on the verge of a new trend, or if it has entered a period where panic buying and selling are taking place.

[Ed Note: Investing cryptocoins and tokens is highly risky as the market is not regulated. It is possible to lose all of your investment.

Cahn recently wrote that TEM’suggests an expansion of range in October/November.

The technical analyst stated that his model suggested a monthly range expansion to 20k for October and Nov.

It could happen ‘from opening of the month to closing of the month. Maybe faster but the risk of 20k is there,’ Cahn said.

“Based on the volatility model, (TEM), it’s set for a range expansion of the weekly and monthly bars. He stated that the range month should run from the Oct. close to the open. It should be near its high point and close out at its lowest.

Analysts weigh in

This model was evaluated by several analysts.

Andrew Rossow, an internet- and technology lawyer, stated that he had read the Recaps of Volatility Reports from 9/27/2018 to 09/27/21. He believes CT’s TEM is a fascinating approach to explain bull/bull behavior.

He stated that TEM is a mere expression of CT’s opinion based upon their own sources.

Rossow stated that he believes it to be one the most realistic explanations/analyses since digital currency was created.

Collin Plume, founder and CEO of My Digital Money offered a different perspective.

He stated that TEM, like many other charts used to forecast crypto market direction is more reactive than predictive.

“It searches for patterns and assumes their applicability to future cryptocurrency developments. Plume said that it overlooks intangibles and events that really dictate the price of crypto.

Retail reaction to events has dictated the bitcoin’s spikes and dips. He stated that mainstream development is the biggest influencer.

“Jack Dorsey declared Bitcoin to be the future, and PayPal bought Bitcoin,” which coincided well with the price’s upward movement.

“Bitcoin reached the $50k mark in January after Tesla announced that it would be buying Bitcoin. Then, Coinbase announced that it would go public and powered through $60k.

Range-Bound Trading

Plume provided more detail by predicting that bitcoin will trade between its 200 day moving average (MA), and its 20-day MA (MA), which are $43,000 & $47,000 respectively, without any significant developments.

He stated that he believes Bitcoin would remain within the range until China decides on Evergrande.

Plume stated that China will bail out Evergrande if it reclaims $50K. It will then be a slow, bumpy ride to $60k.

“However, this trend could be broken if another major events occurs that could trigger retail investors panic sell or panic buy.”

Bullish Market Predictions

Rossow had a different view of the markets. He predicted that bitcoin would continue to expand at the same pace as Cahn’s forecast ‘over the next few month’.

“With the SEC asking for more resources to understand the cryptocurrency industry and institutional investors accepting that having a trusted, secure custodian for their digital asset is the next step in providing global access to financial services, it’s not unreasonable to believe that Bitcoin and Crypto have the very real potential for continued growth,” he said.

Rossow spoke to his belief that bitcoin prices would rise during this time, despite the fact that Cahn’s model only pointed to Bitcoin experiencing significant volatility over the next months.

He stated that Bitcoin is an institution class and that if regulators are open to serious discussions about it in all industries, we can only expect increased growth.

Joe DiPasquale is the CEO of crypto hedge fund manager BitBull Capital. He also spoke to TEM.

“The projection is not surprising considering Bitcoin’s historical performance in November and October.”

He stated that if Bitcoin finishes September above the $40K-42K range, then we will likely see some bullish relief for October.

“However, the extent and impact of this projected price movement is also likely to been impacted by wider macro factors such as economic policy changes such as such.

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