FameEX Hot Topics | Analyst: Volatility Signal Points to $135K Bitcoin in 100 Days

Bitcoin continues to hold strong above the $100,000 mark, consolidating higher as investor confidence grows in the wake of easing market volatility. The CBOE Volatility Index (VIX), a widely watched measure of market fear, has fallen back to its 30-year average of 20 after peaking at 60 earlier this year. This sharp decline followed the May 12 trade agreement between the U.S. and China, which included a 90-day suspension of tariffs and a 115% reduction in duties on both sides. The deal has fueled a broader “risk-on” sentiment across global markets, prompting increased appetite for high-risk assets like Bitcoin and equities.

Bitcoin economist Timothy Peterson highlighted the implications of this shift, stating that the normalization of the VIX indicates a favorable environment for risk-taking. “$VIX dropped substantially yesterday on news of a potential China trade deal. It is now at 'normal' levels. This will be a 'risk on' environment for the foreseeable future,” he commented. Further supporting bullish sentiment, the U.S. Consumer Price Index (CPI) declined to 2.3% year-over-year in April—the lowest since February 2021—beating expectations and reinforcing hopes of potential interest rate cuts from the Federal Reserve.

The combination of reduced market volatility, easing inflation, and a temporary truce in the U.S.-China trade conflict has created an ideal backdrop for Bitcoin’s rally. Peterson previously forecasted a potential surge to $135,000 within 100 days, citing a model that has historically shown a 95% accuracy rate in linking low VIX readings with increased capital inflows into risk assets like Bitcoin.

While April was marked by subdued Bitcoin performance, sentiment has turned sharply in May. According to CryptoQuant, the Bitcoin Bull Score Index jumped from 20 to 80—an indicator typically associated with strong upward price momentum. This surge suggests that buying demand is beginning to outweigh available supply, mirroring patterns seen after the April 2024 halving.

Bitcoin researcher Axel Adler Jr noted that the Fear & Greed Index has risen to 53.3%, signaling cautious optimism without entering overheated territory. He believes the market could be setting up for another breakout, possibly pushing Bitcoin above its all-time high near $110,000.

Disclaimer: The information provided in this section is for reference only and does not represent any investment advice or the official views of FameEX.