Bullish Breakout or Sharp Drop?

Can BTC explode by over 300%, or is a huge crash incoming?

The past week or so has been rather untypically calm for the largest cryptocurrency, with only minor volatility.

However, an important indicator suggests that major turbulence could be approaching, though the eventual direction remains uncertain.

“Explosive Move” on the Way?

The X account Barchart, which focuses on traditional finance, stocks, charts, cryptocurrencies, and everything in between, revealed that Bitcoin’s Bollinger Bands have squeezed to their narrowest point since October 2023. The entity highlighted that the previous occurrence of this setup preceded a 330% rally over the following two years, culminating in the asset’s all-time high above $126,000.

Repeating the scenario, though, shouldn’t be taken as guaranteed. The technical indicator, developed by John Bollinger in the 1980s, consists of a moving average flanked by two channels (upper and lower) that widen in volatile markets and narrow when things calm down.

Squeezing the bands typically foreshadows a big move, yet it provides no clarity on whether a rally or a pullback is ahead. In March this year, the Bollinger Bands (on a monthly basis) tightened to a level never seen before, and days later BTC tumbled from around $75K to approximately $65K.

In May 2025, the crypto community witnessed the opposite reaction. The Bollinger Bands squeezed at a time when the asset was trading at under $95,000, while weeks later it soared beyond $110,000.

Additional Forecasts

Yesterday (August 12), the US Bureau of Labor Statistics released the Consumer Price Index data, and numerous analysts claimed the economic event could be followed by major volatility for BTC. X user Gerla noted that each CPI report from August last year until now has been a precursor to severe turbulence and was sometimes followed by a double-digit price crash for BTC.

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It is important to note that the most recent inflation results matched the previous expectations, which should be taken as a positive sign. X user Wealthmanager reminded that the last three times this happened, BTC climbed by 7%, 10%, and 10%, respectively.

Crypto X has recently been flooded with analysts presenting strong arguments that the primary cryptocurrency may have already reached its bottom, potentially preparing for the next leg up. Nonetheless, the risks of a renewed correction remain, as previous estimations suggest the cycle’s floor might be reached sometime in October. Moreover, one should keep in mind that crypto tends to behave unusually and frequently moves against overall expectations.