On Monday, August 10, the U.S. spot Bitcoin [BTC] ETF flows measured a negative $144.6 million. It broke a streak of positive flows for five consecutive trading days, which had brought in $865.3 million.
At the same time, Bitcoin was also down just over 3% from Sunday’s local high at $65,474. The $65k-$67k is a key supply zone, and the inability to climb past this barrier hinted at bearish control in the market.
The longer-term bearish trend is prevalent in the price charts. The liquidation levels to the south can attract Bitcoin toward $57k, and the turnaround in spot ETF flows was another warning sign.
There was also evidence for compressed volatility. This could make the leading crypto’s price action more interesting in the coming weeks.
Bitcoin could be operating inside the calm before a storm
The Bollinger Bands help measure volatility. The tighter the bands, the less the volatility is. The width is currently 3.8%, and it was a warning of strong band compression, according to crypto analyst Axel Adler Jr.
This was some of the lowest readings the metric has shown in two years. Where there is such a sharp volatility compression, a similarly violent volatility expansion tends to follow.
The ADX indicator measures market strength. Its score was at 11, well below the 25 threshold that signals a strong trend is underway. Moreover, the -DI and +DI lines were moving close together, meaning neither a bull signal nor a bear signal was flashing.
The lack of a directional trend and the compressed volatility was a warning for market participants. A strong price move is brewing, but its direction is still unclear.
