Bitcoin bounced back from the high area of around $30,000, and trends to the upside of its current range. The first crypto by market cap managed to trace back its weekend losses and returned to the $40,000 area.

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At the time of writing, Bitcoin trades at $41,600 with a 6% and 5% profit in the last 24-hours and 7-day, respectively.

The general sentiment in the market seems optimistic as BTC’s price was able to push back the bears’ fresh assault and prevent further losses. The $38,000 to $39,000 area was full of bid orders, as NewsBTC reported yesterday, which proved a critical zone for the rebound.

The current price action seems to be trending upwards in volatility after a long period of stagnation for BTC’s price. As seen below, data from Arcane Research indicates that low volatility levels could be brewing Bitcoin for a fresh rally or a reclaim of its previous highs.

The research firm noted that Bitcoin’s 30-day volatility reached a multi-year low. The last time this metric stood at its current levels was in November 2020.

At that time, Bitcoin broke out of its bear market price action from the $3,000 to $16,000 range and into uncharted territory. The decrease in volatility seems to have hinted at this price movement and could potentially be indicative of BTC’s future performance as it rebounds back to $40,000.

Arcane Research noted the following on BTC’s volatility and why it is signaling more market activity:

Bitcoin’s dull price action over the recent month led bitcoin’s 30-day volatility to reach its lowest levels since November 5^th, 2020, on Saturday, April 16^th. The low volatility regime back in the fall of 2020 held for nearly three months from late September until early November, but such prolonged low volatility period is unusual.

Bitcoin Whales Push Price From The Bottom Of Its Range

Separate data from Material Indicators (MI) indicates an increase in short-term activity from large Bitcoin investors. As seen below, investors with bid orders of around $100,000 (in purple), $10,000 (in red), and $1,000 (in green) are buying into BTC’s current price action.

Retail investors and “Mega” BTC whales remain dormant. In total, other investors classes have been buying as much as $60 million in BTC over the past day.

$39,000 and $38,000 continue to display important support for BTC’s price in case of potential downside. To the upside, $45,000 and $48,000 are BTC’s most important resistance levels with over $10 million in asks orders on these two levels alone.

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Could the BTC whales push the cryptocurrency to the high $60,000 and into uncharted territory as it did in November 2020? Time will tell. The macro conditions seem to be unfavorable for a fresh rally.

#FireCharts 2.0 (beta) shows #Bitcoin liquidity is on the move. There is currently ~$25M in Ask liquidity between here and the next technical resistance level is the 50 Day MA.
Note: MegaWhales have yet to buy. #Crypto
More from Material Indicators… https://t.co/26BLOFwenL pic.twitter.com/qRagkZTBlg

— Material Indicators (@MI_Algos) April 19, 2022

Bitcoin has sharply declined in the past month which has dragged it down to the $40K price point. The digital asset’s downtrend had then promptly dragged their metrics like implied volatility down with it. This decline has been even sharper as bears have gotten a tighter grip on the market. For some, this could be bad news. However, for others, it could mean a period of opportunity.

Bitcoin Implied Volatility Crumbles

Bitcoin’s implied volatility is a metric that is used to illustrate investor expectations of future price volatility of the digital asset going forward. This metric is not only prominent in the crypto space but is used across a number of actives to map out investor expectations over time when it comes to volatility. If this metric is high, then investors are clearly expecting price volatility to be on the high side going forward, which is why this is an important metric for investors, especially those invested for the short term.

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For bitcoin, implied volatility has been on a steady downtrend since the end of 2021. This follows the price movements which have also recorded a similar downtrend in its value. The implied volatile downtrend however ramped up even more at the beginning of this year. It is important to note that low implied volatility (IV) for bitcoin is uncharacteristic, hence why it is important.

BTC implied volatility declines | Source: Arcane Research

With such low levels, volatility bets become a more attractive venture for bitcoin where they can buy call and put options. One thing about low IV levels for bitcoin is that they tend to extend for a Lon time. An example of this is the low IV levels recorded in June 2020 that lasted for six months into December 2020.

Bitcoin’s IV is being impacted by a number of factors, including decentralized finance (DeFi) innovations that are popping up around the corner.

BTC Price Movements

Bitcoin has been moving more or less erratically over the past few months. After hitting its peak of $69K, the digital asset had gone a consistent descent that saw it lose over 30% of the all-time high value. Additionally, the digital asset high is known to be a market mover has dragged the market down with it, losing about $300 billion off its own market cap in the process.

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Bitcoin has however held strong above the $40K point. The digital asset continues to show strong support at this point, suggesting that this is the point for bulls to hold and for bears to beat.

BTC at $42K | Source: BTCUSD on TradingView.com

In the last 24 hours, the price of BTC has grown from the low $41,000 to above $42,000, adding about $1,000 to its value just as the markets begin to open for midweek trading. The price of the digital asset is currently trending at $42,300, with indicators pointing towards a retest of the $42,500 resistance point.

Featured image from Binaryx, charts from Arcane Research and TradingView.com