Crypto traders aimed at enjoying a volatility wave should look at the ether-bitcoin (ETH / BTC) ratio on the binance, which could soon undergo wild oscillations, according to a key indicator called Bollinger Bands.
Bollinger strips are volatility bands placed two standard deviations above and below the simple 20-day mobile average of the price of an asset.
The so-called Bollinger strip pressure occurs when the bands contract closely around the price, suggesting low volatility and a period of consolidation. The market generally strengthens energy during compression, which is finally released in both directions, leading to an explosion of volatility.
Bollinger groups on the ETH-BTC graph have now been the tightest since June 2020, according to TradingView.
Pressure indicates that ether may soon undergo increased volatility against the BTC. The merchants look carefully to see in which direction the price comes out of the bands because, often, the big movement occurs in the same direction.
The optimistic signal of volatility comes as the upgrade of Pectra d’Ethereum, which aims to improve the scalability of blockchain and validator operations and can disturb market activity.
The imminent upgrade, due on May 7, considerably increases the maximum ETH that a validator can widen, from 32 ETH up to 2,048 ETH. It also increases the number of “blob” data units per block from 3 to 6, which allows a maximum of 9. In addition, the upgrade will start the transition to the EVM object format (EOF), a new structure designed to make intelligent contracts more effective.
“Layer 2 networks had to take advantage of the most. By doubling the capacity of the blob and by making the call data more expensive, pectra solidifies the Blobs as the standard for the publication of Rolup data. This strengthens the role of Ethereum as a data availability layer and strengthens its strategy of scaling centered on the Rollup,” said the Nansen analysis firm.
“Defi will also see an elevator,” said the company, saying that NFTS and Blockchain Games could benefit from wider improvements.
