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Bitcoin’s daily range dropped to $3 dollars today as the indecisiveness continues. The low of the range is at $235.74. The high of the range stands at $238.95, almost matching yesterday’s high at $239.00. The day before that we had another important swing high in the area at $238.77. Note that today’s range is not trade-able, a breakout above either extreme may not go very far. But if you had to pick a level that has more potential of the two, it would be the top of the range at $239.
Our second chart below shows the last two instances when the daily range dropped below $3.50 dollars. The first happened on July 3rd when bitcoin had a total range of $3.31. The next day we had a simiarly boring range of only $5 dollars. But the day after that, BTC/USD exploded higher with a daily range of $14.32 to close at $266. After a brief retracement, the gains were extended to a high of $310 dollars per coin.
The second instance was on September 3rd when we had a total daily range of $3.49. Again the next day was slow, with a range of $4.16 as BTC continued to trade flat. But on September 5th we saw more volatility as bitcoin closed higher by $2.6 dollars and the day after that the gains were in the $8 dollars range. By the end of the move BTC/USD hit a swing high of $245.80 from a $231 dollars starting point.
As we can see from the two examples, the duration and the strength of a breakout varied greatly,
Originally appeared at: http://www.forexnews.com/blog/2015/09/12/bitcoin-daily-range-drops-to-3-dollars/