BTC and ETH Volatility Indicators Are Troubling, Market May Enter a Period of High Volatility

Bittime - QCP Capital released a report indicating that their Volatility Momentum Indicator (VMI) has triggered alarms for Bitcoin (BTC) and Ethereum (ETH). This indicates that the market may enter a period of high volatility in the near future.

Directionless BTC and ETH Volatility Signals 

QCP Capital emphasizes that these signals do not indicate a specific price direction. In other words, this signal does not predict whether the price of BTC or ETH will rise or fall, but simply indicates that a large price movement is likely to occur in the near future. 

This signal is directionally agnostic, meaning investors must be prepared to face significant price fluctuations in any direction.

Read also: Short Term Bitcoin Price Prediction, Drop To $50,000?

Recommended Trading Strategy

Based on historical data, QCP recommends investors consider a shift from strategies that generate fixed returns to convex strategies, such as buying options. 

This strategy can help optimize portfolio returns when market volatility increases. In conditions like this, buying options becomes a more profitable strategy because the potential for large price movements can provide higher profit opportunities compared to a fixed return strategy.

QCP Capital also suggests that investors consider cheap directional structures to amplify returns in significant price movements. Given the direction-agnostic nature of the signals, investors can utilize profitable strategies in both bullish and bearish market conditions.

Example Strategies: Bullish and Bearish

For the bullish scenario, QCP recommends buying an ERKO call option with a $60,000 strike price expiring on October 25, for a knock-out price of $75,000 and a cost of $2,100 per contract. The maximum potential return from this strategy is 7.14x the cost.

Meanwhile, for the bearish scenario, QCP recommends buying an ERKO put option with a strike price of $55,000 expiring on September 27, for a knock-out price of $45,000 and a cost of $1,770 per contract. The maximum potential return from this strategy is 5.65x the cost.

Conclusion

With VMI triggering BTC and ETH volatility alarms, investors are advised to be vigilant and consider adjusting their portfolio strategies. 

While these signals do not provide a clear indication of price direction, the large moves that may occur can create great opportunities for those who are prepared to anticipate changes. QCP Capital highlights the importance of strategies that are flexible and responsive to changing market conditions, especially in periods of high volatility.

How to Buy Crypto on Bittime

You can buy and sell crypto assets in an easy and safe way via Bittime. Bittime is one of the best crypto applications in Indonesia which is officially registered with Bappebti. 

To be able to buy crypto assets on Bittime, make sure you have registered and completed identity verification. Apart from that, also make sure that you have sufficient balance by depositing some funds into your wallet. For your information, the minimum purchase of assets on Bittime is IDR 10,000. After that, you can purchase crypto assets in the application. 

Learn How to Buy Crypto on Bittime.

Monitor price chart movements of Bitcoin (BTC), Ethereum (ETH), Solana (SOL) and other cryptos to find out today's crypto market trends in real-time on Bittime.