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4 Indicators you should know
Good Morning,
You and I, both are excited about the surging prices.
But → do you know where the top is?
Today, we’ll explore how to navigate market tops and bottoms:
4 Indicators you should know, to identify the top & bottom
Bitcoin hits All Time High 🔥
4 things you should know, today
4 indicators you should know to identify the top & bottom
I’ll present a set of 4 straightforward yet potent top and bottom indicators.
1. The Pi Cycle Top
The Pi Cycle Top is a tool created by Philip Swift.
→ It considers 2 moving average indicators.
These are the 111 SMA (blue) and 2 * 350 SMA (purple) of Bitcoin's price.
The 111 SMA and 2 * 350 SMA were chosen because their ratio is close to Pi.
How do you read it?
when the 111 SMA (blue) is higher than the 2 * 350 SMA (purple) → market is too hot. 🥵
when the 111 SMA (blue) is lower than the 2 * 350 SMA (purple) → market is cooling down. 🧊
This indicator successfully indicated the top of the crypto market in the past.
But, past results don't guarantee future performance.
Find out more → Pi Cycle Top
2. The Investor Tool
Another creation by Philip Swift.
It's meant for long-term investors to identify potential peaks or bottoms in prices.
→ relies on 2 simple moving averages: the 2-year MA (green) and a 5x multiple of the 2-year MA (red).
How do you read it?
when the price trades below the 2-year MA (green), historically, it's been a good time for investors.
→ leads to significant returns and signals the end of a bearish cycle.when the price trades above the 2-year MA (red) multiplied by 5, it suggests overvaluation.
→ this has signaled the peak of bullish cycles, prompting investors to reduce risk.
Lear more & see live chart → Investor Tool
3. Mayer Multiple
A tool used to measure overbought and oversold conditions in the market — essentially measuring cycle tops and bottoms.
It's calculated by comparing the current price to the 200-day moving average (MA), which is widely recognized as an indicator of the market's long-term trend.
a) Overbought conditions occur when the Mayer Multiple reaches 2.4.
b) Oversold conditions occur when the Mayer Multiple drops to 0.8.
How do you read it?
values below 0.8 (shown in green) indicate that prices are trading at a 20% discount to the 200-day MA.
→ BTC has traded at these levels for about 20% of its trading history, suggesting potential undervaluation.
values above 2.4 (shown in red) indicate prices trading at a premium of 240% times the 200-day MA.
→ BTC has traded at these levels for about 10% of its trading history → indicating potential overvaluation.
Learn more & live chart → Mayer Multiple
4. Hash Ribbon Inversions
Hash Ribbons are indicators that track phases of the mining market's boom and bust cycles.
→ They analyze the relationship between the 30-day moving average (30DMA) and the 60-day moving average (60D) of hash rate, which reflects the amount of computing power dedicated to mining Bitcoin.
How do you read it?
in bull market, miners invest in more mining hardware, causing the hash rate to increase.
→ this results in the 30DMA of hash rate rising faster than the 60D, indicating an expansion phase in the mining market.
in bear markets, miner incomes may suffer, leading some miners to shut down unprofitable rigs (the thing that mines).
→ this reduction in hash rate leads to a phenomenon known as miner capitulation, where the 30D falls below the 60D.
☁️ These indicators are like fortune cookies for Bitcoin — cryptic, occasionally accurate, and should make you hungry for more financial wisdom.
Want to explore more the mentioned indicators?
Learn more & live chart → Hash Ribbons Inversions
Bitcoin Hits All Time High 🔥
Now we can all rest!
Bitcoin hits a new ATH.
It only took 2 years, but we got there.
The following have shown growing appetite:
institutional investors,
pension funds,
insurance companies,
endowments,
foundations, and
mutual funds.
But there’s more…
Mark Harvey on twitter (click for more details)
Mark Harvey, the wizard of financial optimism, shares some hyper-bullish catalysts for Bitcoin, that could happen any time now
→ smaller banks are in trouble and might need help.
→ people might stop trusting regular banks because they see them failing.
→ they'll start looking for safer ways to handle their money (I wonder where…)
→ BTC seems safer because transactions can't be messed with.
Are you pumped the same as me? 🔥
4 things you should know:
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