APT, the governance token of the Aptos Layer 1 blockchain network, has seen a significant decline in price over the past month. This comes amid a general decline in cryptocurrency market activity during this period.
At press time, the altcoin was trading at $5.82, down more than 30%. APT remains at risk of significant price swings as its volatility markers have begun to rise sharply.
Aptos Sees Volatility Spiking
The first indicator of rising volatility in the Aptos market is its Bollinger Bands. The readings of this key volatility market show a widening gap between the upper and lower bands of the indicator.
Bollinger Bands measure the market volatility of an asset and identify potential overbought or oversold conditions. When the gap between the upper and lower bands of the indicator widens, it indicates increased market volatility.
Also, during a period of falling prices, widening bands indicate that the downtrend may continue. This signals stronger selling pressure or a lack of interest in buying at current price levels.
The rising average true range (ATR) of APT confirms the surge in market volatility.
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This indicator measures market volatility by calculating the average range between high and low prices over a specified number of periods.
When its value increases, it indicates an increase in market volatility and hints at the possibility of price fluctuations in either direction. At press time, ATR APT is 0.48. It has been in an uptrend since July 1.
APT Price Prediction: Bearish Divergence Puts Token at Risk
Despite the drop in APT’s price, it has seen a surge in daily trading volume. While the token’s price has fallen by 18% over the past week, its trading volume has increased by 29% over the same period.
The opposite movements in APT’s price and its daily trading volume create a bearish divergence, suggesting that more market participants are actively selling the asset.
If sales activity remains high, the token price may fall to $5.62.
However, while an increase in volume during a decline usually supports the continuation of a downtrend, extreme spikes in volume can sometimes precede a price reversal. Therefore, if APT were to see a correction, its price could rise above $5.90.
