Bitcoin – watch out at midnight

Bitcoin – watch out at midnight

Strong price fluctuations are the rule for crypto currencies and not the exception. For traders, these are the best prerequisites, especially as trading can take place around the clock seven days a week on the crypto exchanges.

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The platform allows you to trade the most popular coins easily and transparently. But precisely because of the enormous volatility, the risks should not be underestimated. An analysis of the price dynamics in the course of the day at Bitcoin shows when investors should be active.

Statistical evaluations are still new territory for crypto currencies, the data history is comparatively short. Nevertheless, it is worthwhile to analyse special features of the market, especially in the short-term area. The question of when the Bitcoin frequently marks its daily high or low and the volatility is particularly strong is exciting, for example. This is particularly important for traders who operate with leverage products (see Vontobel’s product range here).

LongHash evaluated the data from July 6, 2017 to July 2, 2019. The highest and lowest prices for each hour of a day were compared with the other 23 hours. The graph shows the number of frequencies per hour: Pink bars stand for the daily high, blue marks for the daily low. The times are displayed in UTC, in Central European Summer Time the time difference is 2 hours.

Accordingly, the volatility between midnight and 1 o’clock at night is particularly strong (2 to 3 o’clock German time), the Bitcoin then often already reaches its daily high or daily low. Above all at 1 o’clock UTC the most well-known crypto currency showed particularly strong movements in the past two years.

This can also be justified “fundamentally”

  1. In North America the working day ends around this time, while the numerous crypto fans in Asia intervene in the market. Western and Asian traders are active at the same time, liquidity reaches peak levels.
  2. In addition, market moving news mostly comes from the USA or Asia, Europe plays only a minor role.
  3. No reliable answer can be given to the question of when is the perfect time to enter the market.
  4. Between 3 a.m. and noon UTC, the coin marked a daily low more frequently, whereas at 7 p.m. it was often a daily high.
  5. However, the differences are still at least too small to be able to derive a trading approach from them.