1. Sudden Volatility Spike
Indicates a rapid and unexpected BTC price movement—either upward or downward.
Typically triggered by macro news, exchange liquidations, or liquidity gaps.
2. Market Liquidity Stress
Sharp moves often sweep order books, causing slippage and a cascade of liquidations.
High funding-rate shifts signal aggressive long/short imbalances.
3. Derivatives Impact
Large BTC wicks usually coincide with mass liquidations on perpetual futures.
Funding flips and open interest resets are common after big shocks.
4. Investor Behavior Shift
Retail tends to react emotionally; whales frequently accumulate or offload strategically.
On-chain data during shocks often shows increased activity from long-term holders.
5. Short-Term Outlook
After a “shock” event, BTC typically enters either:
Volatility compression (range-bound consolidation), or
Continuation move in the direction of the initial shock.
6. Risk Management Notes
Set tighter stop-losses during shock phases.
Avoid over-leveraged positions; expect unpredictable price swings.
