I think that makes sense regarding the price movement of bitcoin. Basically, its market value depends on the demand of the people and that is when they buy bitcoin or sell their bitcoin holdings. But when everyone will hold and no one will sell, the volume will only have the buying transaction which will cause the price to spike.
But if everyone is holding then eventually there would be someone that would sell and if he is a big holder then some would panic and sell as well which would cause a big red candle. I think the solution would be to make people be aware of bitcoin and then increase its demand. The key would be to make people use bitcoin as a currency so that transactions would continue to flow and volume would still be there. It would help in making the merchants consider in adopting it.