Bitcoin's volatility has shrunk to extreme levels not seen in nearly two and a half years, brewing significant fluctuations

According to Barchart, the daily Bollinger Bands for Bitcoin have formed one of the tightest widths in the past two and a half years. This indicates that Bitcoin is "consolidating and tightening," possibly preparing for a major market movement.

Bollinger Bands are a commonly used indicator in technical analysis, consisting of three lines: the middle band, which is usually the 20-day simple moving average (SMA); the upper band, which is the middle band + 2 times the standard deviation; and the lower band, which is the middle band - 2 times the standard deviation. Historical experience shows that after a significant tightening of the Bollinger Bands, a directional breakout (either upward or downward) often follows. It is common for volatility to suddenly expand from an extremely low state.