Rally Fatigue? Low Bitcoin Volumes Could Cap Upside

Bitcoin prices are at their highest ever, but there may be a chink in the cryptocurrency's armor – low volumes.

AccessTimeIconNov 20, 2017 at 12:15 p.m. UTC
Updated Sep 13, 2021 at 7:10 a.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

Bitcoin prices are at their highest ever, but there may be a chink in the cryptocurrency's armor.

Just a week ago, the bitcoin-U.S. dollar (BTC/USD) exchange rate hit lows near $5,500. Then, by Friday, prices were flirting with fresh record highs around the $8,000 mark.

With bid tone remaining intact over the weekend, bitcoin rose to an all-time high of $8,101.91 around 20:00 UTC yesterday, as per CoinDesk's Bitcoin Price Index.

However, while the $2,500 rally is impressive, data from CoinMarketCap indicates the move higher from $7,853 (Nov. 17 open price) lacks substance, as trading volumes have steadily declined over the last three days.

Struggling volumes


The above chart shows:

  • A clear divergence between the rising prices and trading volumes. Volumes did pick up after Nov. 14, but topped out two days later. Meanwhile, prices continue to rise and clocked record highs yesterday.
  • Furthermore, trading volumes have stayed well below the Nov. 12 high throughout the $2,500 rally from the recent lows near $5,500.

A low volume rally is not necessarily an ominous sign, but could be an indication of overstretched valuations: i.e. investors are reluctant to invest fresh capital above $7,800 levels. Further, the Google search volumes have seen an anemic rise, perhaps validating that argument.

So, should we expect a corrective pullback?

The technical charts favor further upside in prices, but signal the potential for a pullback to $7,300 levels if prices break below $7,900 today.

As of writing, BTC is trading at $8,035 levels. As per CoinMarketCap, the cryptocurrency has added 3.4 percent in the last 24 hours.

4-hour chart


The above chart shows:

  • Bull flag breakout
  • Bullish 50-MA and 100-MA crossover
  • The relative strength is beginning to curl up again, but stands very close to the overbought region.

Bull flags (named for their "flag and pole"appearance) occur during strong uptrends. They are a bullish continuation pattern: i.e. an upside break signals resumption of the rally.

On the chart above, an upside break/bull flag breakout has been confirmed, meaning the doors are open for a rally to $10,393 (target as per the measured height method: i.e. pole height added to breakout point).

However, as mentioned above, the breakout lacks substance due to dropping volumes. Additionally, bitcoin is already at record highs and overbought as per the weekly and monthly RSI.


  • The signs of bull market exhaustion detailed above indicate heightened odds of a corrective pullback. A break below $7,900 would open doors for a drop to $7,200 (10-day MA).
  • On the other hand, a move above $8,100, if accompanied by a pick-up in volumes today, would validate the bull flag breakout and could yield a rally to $10,000 levels over the next week or two.

image via Shutterstock


Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is an award-winning media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. In November 2023, CoinDesk was acquired by Bullish group, owner of Bullish, a regulated, institutional digital assets exchange. Bullish group is majority owned by Block.one; both groups have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary, and an editorial committee, chaired by a former editor-in-chief of The Wall Street Journal, is being formed to support journalistic integrity.

Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.