Bitcoin Cycle Master [InvestorUnknown]

9월 29일

The "Bitcoin Cycle Master" indicator is designed for in-depth, long-term analysis of Bitcoin's price cycles, using several key metrics to track market behavior and forecast potential price tops and bottoms. The indicator integrates multiple moving averages and on-chain metrics, offering a comprehensive view of Bitcoin’s historical and projected performance. Each of its components plays a crucial role in identifying critical cycle points:

• Top Cap: This is a multiple of the Average Cap, which is calculated as the cumulative sum of Bitcoin’s price (price has a longer history than Market Cap) divided by its age in days. Top Cap serves as an upper boundary for speculative price peaks, multiplied by a factor of 35.
  

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• Delta Top: Defined as the difference between the Realized Cap and the Average Cap, this metric is further multiplied by a factor of 7. Delta Top provides a historically reliable signal for Bitcoin market cycle tops.
  

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• Terminal Price: Derived from Coin Days Destroyed, Terminal Price normalizes Bitcoin’s historical price behavior by its finite supply (21 million bitcoins), offering an adjusted price forecast as all bitcoins approach being mined. The original formula for Terminal Price didn’t produce expected results, hence the calculation was adjusted slightly.
  

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• Realized Price: Calculated as the Market Cap Realized divided by the current supply of Bitcoin, this metric shows the average value of Bitcoin based on the price at which coins last moved, giving a market consensus price for long-term holders.
  
• CVDD (Cumulative Value Coin Days Destroyed): This on-chain metric analyzes Bitcoin’s UTXOs (unspent transaction outputs) and the velocity of coins moving between wallets. It highlights key market dynamics during prolonged accumulation or distribution phases.
  
• Balanced Price: The Balanced Price is the difference between the Realized Price and the Terminal Price, adjusted by Bitcoin's supply constraints. This metric provides a useful signal for identifying oversold market conditions during bear markets.
  

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Each component can be toggled individually, allowing users to focus on specific aspects of Bitcoin’s price cycle and derive meaningful insights from its long-term behavior. The combination of these models provides a well-rounded view of both speculative peaks and long-term value trends.

Important consideration:
Top Cap did historically provide reliable signals for cycle peaks, however it may not be a relevant indication of peaks in the future.