Amberdata Blog Estimating Future Volatility Ranges with Volatility Cones

Volatility cones are a practical tool for traders who wish to forecast the range of future price swings using historical realized volatility data. By analyzing past market behavior, volatility cones help set expectations for how much an asset might move in the future. The technique provides percentile figures, such as minimum, p25, p50, and p75, which define a range within which the asset has historically traded. This information assists traders in determining whether current market conditions are relatively subdued or exceptionally volatile.