Bitcoin's chip concentration indicator has climbed to 14.8%, putting the market close to what has historically been a high-risk volatility zone, according to crypto analyst Murphy. In a report flagged by Odaily, Murphy said the metric itself does not determine where BTC prices head next. Historical data, however, offer a pattern: once the concentration curve turns, prices tend to keep moving in the direction they were going beforehand. If BTC had been rising, the probability of continued upward swings is higher; if it had been falling, downward swings are more likely. Because the indicator is still in an upward phase, Murphy says the next direction cannot yet be determined. Market data nonetheless point to a build-up of potential volatility risk as concentration keeps rising, leaving bitcoin exposed to larger price swings. The latest level places BTC close to a historically high-risk area without providing a directional signal for now, according to Murphy.
Crypto analyst Murphy said bitcoin's chip concentration has risen to 14.8%, moving close to what is historically seen as a high-risk volatility zone.
In a report carried by Odaily, Murphy stressed that the concentration metric alone cannot determine where BTC price moves next. The useful signal, based on historical data, only appears when the curve turns. If prices were rising before that inflection, higher odds point to continued upward swings; if prices were falling, the swing is likely to continue lower.
Signal still climbing
With the concentration index still in its rising phase, Murphy said the next direction of volatility cannot be judged for now. Market data, however, show that the rise in chip concentration has been accompanied by an accumulation of potential volatility risk, leaving the bitcoin market open to more pronounced price movements.
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