Price volatility expectation represents the market’s collective anticipation of how much an asset’s price is likely to fluctuate over a specific future period. This expectation is often derived from options pricing, specifically the implied volatility, which reflects the market’s assessment of future price swings. High volatility expectations suggest a greater potential for significant price movements, either upward or downward. It is a key measure of perceived market risk.
Context
Crypto news and market analysis regularly report on price volatility expectations, especially for major digital assets, as these metrics provide insight into anticipated market behavior. Increases in implied volatility often precede major economic announcements, regulatory decisions, or significant protocol upgrades. Understanding these expectations helps investors gauge the perceived risk associated with holding or trading certain cryptocurrencies and contextualize news about future market movements.
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