Bitcoin ‘Choppiness’ Index Hints $110K BTC Price Will Be Hard To Break

Bitcoin (BTC) will face more “sliced” movements as a certain BTC price scale boils down.

A Dec. 6 survey from onchain analytics platform CryptoQuant suggests that cap-related behavior will continue to frustrate Bitcoin bulls.

Analysis: Bitcoin Risks Delay Until End of 2024

Bitcoin hit a new all-time high of nearly $104,000 this week, ahead of a quick crash of more than 10 percent.

Nearly $1 billion in just 24 hours, traders got a stark reminder of just how volatile crypto markets can be.

CryptoQuant, however, now sees a different short-term picture – bearish BTC price action.

“The 14-day Choppiness Index is in an early zone showing corrective movements during consolidation,” contributor Percival wrote in one of the Quicktake blog posts.

Percival uses the Chopinness Index (CI) to indicate that BTC/USD has started a cooling period after the current flash volatility.

CI uses a scale of 0-100, with higher values ​​indicating “more” market conditions. A low value indicates a market that is trending in the opposite direction – up and down. Crossing the 60-level below or the 30-level represents a change from a choppy to a trend and vice versa, representing events that traders are interested in.

The Daily CI measured 56.7 at the time of writing on December 7, according to data from Cointelegraph Markets Pro and TradingView, after reaching its highest level since mid-August.

“One thing to consider is the consolidation period, there were 20 days off in the 2020/2021 cycles and the average reduction in consolidation since March was ~20 days,” continued Percival.

“The stronger the rate, the greater the increase.”

New BTC price consolidation at $110,000

While a longer period of consolidation could lead to a more violent return to the trend, in the short term, Bitcoin bulls may see a disappointingly slow advance in price discovery.

RELATED: 4 New BTC Price Targets Will See Bitcoin Over $124K in the New Year

Considering BTC price targets once this happens, Percival uses both market psychology and the profitability of speculative traders as a guide.

In particular, short-term holders (STHs) – entities that hold coins for 155 days – will see signs of profit at $110,000 and $120,000. These levels are broadly related to the standard deviation of the indicator that measures their overall value.

“Looking at STH's confirmed price, we can project strong resistance levels that we may encounter in the market, the first level will be $110K (+1.5sd), a huge profit zone for STH,” the article concluded.

“When traders deal with psychological numbers, $120K has a very impactful psychological and emotional charge, and being a value within +2sd makes this floor a deep consolidation camp.”

This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.