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Volatility indexes, like the Bitcoin Volatility Index (BVOL), measure market uncertainty. Low volatility often precedes explosive moves, as traders position for breakouts. High volatility can indicate panic or euphoria, increasing risk for leveraged trades. Monitoring volatility alongside Bollinger Bands helps traders anticipate when the market may transition from consolidation to expansion. For example, prolonged low BVOL readings often lead to significant directional moves once a catalyst emerges.