Bitcoin (BTC) Approaches Decisive Moment as 1-Week Realized Volatility Collapses to Historical Lows

Bitcoin sought to rise over its current all-time high of $109,114, reached Jan. 20, 2025, and return to price discovery.

Bitcoin (CRYPTO: BTC) has been consolidating for weeks now, and its 1-week realized volatility has fallen to 23.42%, approaching historical lows, according to a recent Glassnode tweet.

To put this in perspective, realized volatility was last lower in October 2024 and November 2023, when it fell to 22.88% and 21.35%, respectively.

“Bitcoin 1-week realized volatility has collapsed to 23.42%, nearing historical lows. In the past four years, it has dipped lower only a few times - e.g., Oct 2024 (22.88%) & Nov 2023 (21.35%). Similar compressions in the past led to major market moves:.”

As Glassnode points out, such compressions usually preceded significant market moves.

Bitcoin's 1-week options implied volatility also fell to 37.39%, a multi-year low.

“Similarly, BTC 1-week options implied volatility has fallen to 37.39%, a multi-year low. The last time IV was this low (2023, early 2024), major volatility spikes occurred. Meanwhile, long-term IV stays greater (three months at 53.1%; six months at 56.25%).”

According to Glassnode, the market is now approaching a “deciding moment” — a phase where price action is primed for uncoiling.

If demand remains strong, Bitcoin could establish a new range above its all-time high of $109,114, the data provider said.

“Bitcoin 1-week realized volatility has collapsed to 23.42%, nearing historical lows. In the past four years, it has dipped lower only a few times - e.g., Oct 2024 (22.88%) & Nov 2023 (21.35%). Similar compressions led to major market moves.”

However, a lack of sustained buy pressure may result in a deeper distribution-driven correction, similar to prior post-ATH phases, Glassnode said.

“This would most likely be triggered by fear among recent buyers who see their newly acquired coins go from profitable to unrealized losses.”

At the time of writing, Bitcoin was up 1.49% in the last 24 hours to $98,915 after reaching an intraday high of $98,980.

Bitcoin is currently confronting the short-term barrier at $99,067, which coincides with the daily SMA 50.

Bitcoin must break through this level to exit its current trading range and return to the $100,000 mark.

On the other hand, a massive demand zone has formed just below the current price. According to IntoTheBlock, 2.76 million addresses bought a total of 2.1 million BTC at an average price of $97,100.

If the market faces further downward pressure, this zone may act as robust support.