Research on Timing & Volatility

The convergence of the linear extension of volatility bands toward a specific point is a phenomenon rooted in market equilibrium dynamics and statistical projection. When volatility contracts, it often signals a transition from a high-activity phase to a period of consolidation, where price fluctuations narrow, leading to a temporary state of balance between buying and selling pressures. This focal point may represent a fair market value, an equilibrium price level, or a statistically significant mean, derived from moving averages, regression models, or other analytical techniques. Additionally, the convergence could indicate an area where price is expected to stabilize before a potential breakout, as volatility tends to move in cycles of expansion and contraction. In many cases, such a point acts as a precursor to future market movement, suggesting that once compression reaches a critical level, price action may soon undergo a directional shift, either resuming a trend or initiating a new one.

RESEARCH
I used linear generated extensions FREMA (Volatility bands based on Buying & Selling Pressure) on BTCUSD (because 24h) to carry out a quick experiment on 15mTF in order to observe graphically specific properties of volatility.
As the lines diverge from their intersection, a key question emerges: how will price react to this expansion, where angles defined by selling and selling pressure are inverted? Will the market take this as a signal for a breakout, surging in one direction with renewed momentum, or will it hesitate, moving sideways as traders search for confirmation? The contraction leading to this moment suggests a buildup of pressure — now released into a phase where volatility returns. If buyers take control, price could rally sharply, breaking through resistance levels. Conversely, if sellers dominate, a sharp decline might unfold. The widening of the bands signals the beginning of a new phase where direction and strength will soon become clear.
Most importantly I'll establish how price behaves when it encounters those lines.