Bitcoin Markets Prepare for Increased Volatility in 2026
Bitcoin has commenced 2026 trading at approximately $87,500, with market participants watching closely as traditional financial markets reopen. The cryptocurrency’s price stability at this level signifies a cautious optimism amid mounting technical signals suggesting heightened volatility in the near term.
Key Takeaways
- Bitcoin remains poised around $87,500 ahead of the official start of traditional finance trading this week.
- Technical indicators such as the Relative Strength Index (RSI) and Bollinger Bands signal imminent large price swings.
- Market analysts are increasingly questioning the relevance of the long-held four-year cycle theory for Bitcoin’s price patterns.
- Despite doubts about historical cycles, forecasts predict potential new all-time highs in 2026, with some experts targeting $150,000.
Market Sentiment and Technical Outlook
The market’s tone ahead of the trading season is a blend of trepidation and cautious hope. According to trader Jelle, “New year, new opportunities. We are observing a three-day bullish divergence right above key support levels,” referencing technical analysis on X. This divergence on the RSI hints at possible upside movement for Bitcoin in the upcoming quarter.
Meanwhile, analytics firm Quantdata21 highlights rising volatility risks. Data from TradingView reveals that the Bitcoin/USD chart is showing signs of contraction in volatility, with both weekly RSI levels and Bollinger Bandwidth reaching record lows. As previously reported, the Bollinger BandWidth indicator’s record-tight squeezing in late 2025 indicated an imminent significant price move. Such a scenario historically predicted substantial upward trends, akin to what transpired early 2023.
“The only other time when daily Bollinger BandWidth was this tight with weekly RSI below 40 was January 2023, and Bitcoin subsequently surged,” noted Quantdata21.
Challenging the Four-Year Cycle Paradigm
Despite historic patterns suggesting Bitcoin experiences significant price declines post-halving—observed in 2025, which saw the asset close its year in the red for the first time—market commentary suggests the traditional four-year cycle may be approaching an end. Twitter analyst CipherX emphasized this shift: “Cycles were never laws of nature; they were liquidity patterns influenced by macroeconomic factors and market participants.” This perspective echoes broader debates about the relevance of the established cyclical theory in the current macro environment.
Bitcoin’s 12-month chart illustrates the breakdown of previous cyclical behavior, leading notable figures like Simon Dixon (CEO of Bitcoin security firm Bnk To The Future) to declare, “The era of the four-year cycle is over.” Nonetheless, bullish forecasts persist, with many industry leaders predicting new all-time highs—some reaching $150,000—based on evolving market dynamics and institutional interest.
In the short term, analyst Michaël van de Poppe suggests Bitcoin might attempt to test the $90,000 mark in the coming week, citing expanding investor participation as a catalyst for upward momentum.
