Bitcoin Price Aims Higher as Volume Returns, Volatility Crumbles

Bitcoin’s price was little changed at the start of Monday’s session, though a volume breakout overnight signaled the return of bullish momentum. At the same time, volatility has dropped to its lowest level in nearly three months, a possible sign that the bears were slowly relinquishing control of the market.

BTC/USD Update

The bitcoin price notched a session high of $3,750.00 on Bitfinex following a sudden burst higher during the overnight session. While Bitfinex tends to skew prices upward, the average BTC/USD value was recorded at $3,695.61, according to CoinMarketCap.

At the time of writing, bitcoin was worth $3,686.60 on Bitfinex. On most major cryptocurrency exchanges, it was trading in the $3,585-$3,595 range. The current aggregate price on CoinmarketCap is $3,650.38.

The leading digital currency turned a corner on Friday, launching nearly double-digit gains on the back of a dramatic upsurge for Litecoin and other alternative currencies. In doing so, bitcoin returned above $3,550, a crucial long-term support level.

At current vales, bitcoin has a total market capitalization of $64 billion. That represents 52.9% of the entire cryptocurrency market. The total value of all digital currencies is currently seen at $121.1 billion.

Volumes Up, Volatility Down

Bitcoin’s sudden burst higher through the overnight session was propelled by a surge in trading volume on virtual exchanges. Over a 12-hour stretch, volumes increased by 14%, to around $6.5 billion, according to CoinMarketCap.

Derivatives platform BitMEX saw a bigger share of the daily action. The exchange has processed nearly 12% of BTC trades over the past 24 hours. The spot market accounted for the rest, with lesser known exchanges like CoinBene and OOOBTC seeing a larger share of the volumes. In fact, the bitcoin market appears to be highly democratized, with a bevvy of exchanges accounting for a roughly equal share of the pie.

From CoinMarketCap:

As is usually the case, market volumes declined sharply over the weekend but remained well above the recent average. The turnover exceeded $8 billion during the initial breakout on Friday. More on that story: Litecoin Sparks Huge Crypto Rally as Bitcoin Smashes Through $3,700.

After the initial spike on Friday, bitcoin’s volatility index has declined further, reaching its lowest level in nearly three months. As of Sunday, the 30-day volatility index was estimated to be 2.16%. This number measures how much bitcoin’s daily price varies over the past month.

While volatility is often seen as a double-edged sword, its decline is a welcome sign for traders enduring the longest bear market in history. It signals that the worst of the downtrend, which was accompanied by higher volatility, has passed.

Related: Has Bitcoin Bottomed? A Closer Look at the Bullish and Bearish Cases.

Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Chief Editor to and Contributor to, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi