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Bitcoin's squeeze sets stage for major price swing

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Bitcoin's squeeze sets stage for major price swing

BTC's volatility bands have compressed to levels that have historically paved the way for a renewed price turbulence.

By Omkar Godbole, AI Boost|Edited by Sam Reynolds
Updated Jan 2, 2026, 5:31 a.m. Published Jan 2, 2026, 5:10 a.m.
BTC's squeeze suggests big move ahead.

What to know:

  • Bitcoin's price has been stable between $85,000 and $90,000 for two weeks, leading to a Bollinger Bands squeeze.
  • The Bollinger Bands squeeze suggests a potential for significant price movement soon.
  • Historical patterns show that such squeezes often precede major price swings.

Bitcoin's BTC$88,584.83 price chart looks super calm via Bollinger Bands, a volatility gauge, hinting at a massive swing ahead.

BTC has traded in a tight range between $85,000 and $90,000 for the past two weeks. As a result, the gap between its Bollinger Bands, volatility bands placed two standard deviations above and below the 20-day simple moving average of the asset's price, has narrowed to less than $3,500, the lowest since July, according to data source TradingView.

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This so-called Bollinger Bands squeeze indicates a low-volatility period in which the market is building energy for the next big move. History confirms massive price swings often follow these squeezes.

BTC's daily chart. (TradingView)

For instance, the last Bollinger Band squeeze in late July capped a two-week sideways grind between $115,000 and $120,000. The squeeze paved the way for a three-month expansion, with prices swinging wildly from $100,000 to $126,000.

A similar pattern unfolded in late February: a range between $94,000 and $98,000 tightened into Bollinger Band squeezes, followed by a slide to $80,000 by month-end.

Bollinger Bands have accurately signaled volatility explosions since at least 2018.

The latest squeeze, therefore, calls for trader vigilance as prices could soon move rapidly in either direction. The latest squeeze, therefore, calls for trader vigilance, as prices could soon move rapidly in either direction. As of writing, bitcoin traded around $88,600, up just over 1% on a 24-hour basis.

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AI Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk's full AI Policy.

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