Bitcoin PlanI believe we will get a hard correction for Bitcoin around the 85k mark towards 60k and then run it back turbo to 160k.
NFA
BTCUSDC
Bitcoin's Meteoric Surge: A Paradigm Shift in FinanceBitcoin's recent surge has captured the attention of investors worldwide, marking a significant milestone in the evolution of digital currencies. With its decentralized nature and limited supply, Bitcoin has emerged as a preferred hedge against inflation and economic uncertainty.
Institutional adoption and growing mainstream acceptance have propelled Bitcoin to new heights, challenging traditional financial systems and reshaping the way we perceive value and ownership. Despite occasional volatility, Bitcoin's resilience and increasing integration into the global financial landscape underscore its long-term potential.
As Bitcoin continues to redefine finance, its impact reverberates across industries and borders, sparking conversations about the future of money and decentralization. With each milestone, Bitcoin cements its position as a transformative force in the digital age, heralding a new era of financial innovation and opportunity.
Bitcoin: Redefining Finance in the Digital AgeBitcoin continues to revolutionize the world of finance, reshaping traditional notions of currency and investment. As the pioneer of cryptocurrencies, Bitcoin's decentralized nature and groundbreaking technology have propelled it to the forefront of the digital revolution.
In recent months, Bitcoin has experienced unprecedented growth, attracting attention from both institutional investors and retail traders. Its finite supply and decentralized network make it a hedge against inflation and government intervention, driving demand and pushing prices to new heights.
Despite occasional volatility, Bitcoin's resilience and increasing adoption underscore its significance in the modern financial landscape. As more businesses and individuals embrace Bitcoin as a legitimate form of payment and store of value, its role in mainstream finance continues to expand.
With ongoing technological advancements and growing acceptance, Bitcoin's influence is poised to extend far beyond the realm of cryptocurrencies. As it continues to redefine finance in the digital age, Bitcoin remains a powerful force driving innovation and shaping the future of money.
Bitcoin's Evolution: Navigating the Path to Mainstream AdoptionBitcoin, the pioneering cryptocurrency, continues to evolve and make strides towards mainstream adoption. Its decentralized nature and groundbreaking technology have sparked a revolution in the financial industry, challenging traditional banking systems and reshaping the way we perceive and transact value.
In recent months, Bitcoin has garnered increased attention from institutional investors and corporations, signaling a growing acceptance and recognition of its value as a digital asset. This influx of institutional interest has contributed to Bitcoin's price stability and overall market growth, further cementing its position as a legitimate investment option.
However, challenges remain as Bitcoin navigates its path to mainstream adoption. Regulatory uncertainty, scalability issues, and environmental concerns pose significant obstacles that must be addressed to ensure Bitcoin's long-term viability and sustainability.
Despite these challenges, the Bitcoin community remains committed to overcoming obstacles and driving innovation within the cryptocurrency space. With ongoing advancements in technology and increasing adoption across various industries, Bitcoin is well-positioned to continue its journey towards widespread acceptance and integration into our daily lives.
As Bitcoin continues to evolve and mature, its impact on the global financial landscape will only continue to grow, paving the way for a more decentralized and inclusive financial future.
"Bitcoin's Meteoric Rise: Fueling a Financial RevolutionBitcoin's meteoric rise continues to captivate the world as it surges to new heights, sparking a financial revolution unlike any other. With its decentralized structure and limited supply, Bitcoin stands as a symbol of financial sovereignty, challenging traditional banking systems and empowering individuals worldwide.
As institutional investors flock to Bitcoin in search of a hedge against inflation and economic uncertainty, its value proposition grows stronger by the day. The recent embrace of Bitcoin by corporations and financial institutions further validates its status as a legitimate asset class, propelling it into mainstream consciousness.
However, Bitcoin's journey is not without its challenges. Regulatory hurdles and environmental concerns cast shadows on its future, prompting calls for innovation and responsible stewardship within the cryptocurrency community. Yet, amidst the uncertainty, Bitcoin remains resilient, embodying the spirit of innovation and disruption that defines the digital age.
As Bitcoin continues to redefine the boundaries of traditional finance, one thing is clear: its impact will be felt for generations to come, shaping the future of money and revolutionizing the way we transact and store value.
"Bitcoin Surge: Riding the Waves of Digital Currency Momentum"In recent times, Bitcoin, the pioneer of cryptocurrencies, has been making headlines once again with its meteoric rise in value. As investors and enthusiasts alike eagerly watch the charts, the price of Bitcoin has been on a bullish streak, defying expectations and sparking renewed interest in the digital asset market.
The surge in Bitcoin's price can be attributed to several factors. Firstly, the growing acceptance and adoption of cryptocurrencies by mainstream financial institutions and corporations have boosted investor confidence in Bitcoin as a legitimate store of value. Major companies embracing Bitcoin as a form of payment and investment, along with the integration of cryptocurrencies into traditional financial services, have contributed to its upward trajectory.
Moreover, the current global economic landscape, characterized by inflationary pressures and uncertainty in traditional markets, has driven investors to seek alternative assets for diversification and hedging against inflation. Bitcoin, with its finite supply and decentralized nature, presents itself as a viable hedge against inflation and a safe haven asset in times of economic instability.
Additionally, the recent developments in the cryptocurrency space, such as the rise of decentralized finance (DeFi) platforms and the growing interest in non-fungible tokens (NFTs), have fueled demand for Bitcoin and other cryptocurrencies. These innovations have expanded the utility and use cases of cryptocurrencies, attracting both institutional and retail investors to participate in the digital asset market.
However, it's essential to acknowledge the inherent volatility and risks associated with investing in Bitcoin. While the current bullish trend may seem promising, the cryptocurrency market remains highly speculative and prone to sudden price fluctuations. Therefore, investors should exercise caution and conduct thorough research before entering the market.
In conclusion, the recent surge in Bitcoin's price reflects the evolving landscape of digital currencies and their increasing prominence in the global financial ecosystem. As Bitcoin continues to captivate investors with its potential for growth and innovation, it remains imperative for market participants to stay informed and navigate the dynamic cryptocurrency market with prudence and diligence.
$BTC - 1H Reversal pattern in 1H Tf confirmed and broken!
So far -11% Pullback after big bullish in last weeks.
Every Fair Value Gap & Volume Gap For Bitcoin {10/02/2024}Educational Analysis says BITCOIN BTCUSD may move in this range for some time according to my technical.
Broker - Coinbase
This is not an entry signal. I have no concerns with your profit and loss from this analysis.
Why this range?
Because I think It's going to be short selling for Bitcoin this year or up to the end of this year, There is a lot of liquidity as fvg & volume gaps to the downside.
Bitcoin Institutional traders have built a lot of liquidity when the price was very low, I think it's time to collect it and after that go for an all-time high.
Let's see what this pair brings to the table in the future for us.
Please check the Comment section on how it turned out for this trade.
I HAVE NO CONCERNS WITH YOUR PROFIT OR LOSS,
Happy Trading, Fx Dollars.
BITCOIN is developing the largest C & H of all time in crypto!The cup & handle pattern that BTC is currently forming is by far the largest that has ever been seen or experienced in all of crypto. I cannot express how powerful this could be for the price of BTC, as well as the vast majority of cryptos. Having a massive cup & handle formation like this, on the daily chart, that has taken over two and a half years to form is absolutely unprecedented in all of crypto, and it's nearly impossible to predict what the outcome will be, since this has never happened before, and thus, there's nothing to compare it to.
There will be some major consolidation after reaching the rim-line, assuming that this pattern plays out. At this point, it's still forming the cup, and the handle should soon follow if the pattern is correct. I will be watching it, and adjusting the chart as needed, as nobody knows the exact pattern or numbers involved at this point, as they are constantly evolving as we continue to move forward.
Don't FOMO in at high prices for long-term holdings, because if this pattern plays out, you will have better prices coming after we touch the old all-time high and start forming the handle.
Good luck, and always use a stop-loss!
*** I apologize for the repetitive post. Tradingview has taken this post down twice now.
MSTR on Path to be in the top 20. Ranked 473.
Congratulations on MSTR and Michael Saylor pushing MSTR into the top 500 US companies.
This is a major event for Bitcoin as this puts MSTR in S&P 500 indexes meaning global capital will automatically allocate to MSTR that will then use funds to purchase more Bitcoin pushing the MSTR price up. Using corporate debt and smart leverage.
MSTR & Spot ETF's will be the main factors to how Bitcoin makes it's way to $1,000,000
Bitcoin will be over a 10 Trillion market cap and the MSTR price will trade over $25,000.
Full transparency I have rotated my miners into MSTR & BITO calls. For now nothing is going to beat the MSTR & BITO Gamma offered till the end of the cycle. Miners will be a great pickup during the bear market.
MSTR is now the Berkshire Hathaway of Bitcoin.
Was i wrong? BTCI wasn't posting updates on BTC for a reason: nothing is clear yet. Was i wrong? I am short with an avg entry of 53k actually, and yes, i am in loss. I am still holding it. I am holding because we are at major resistance ($51.800 is a major daily resistance) and Greed is Extreme. Honestly, i think this is a trap from ETF funds that are just showing potential profits to new, big clients. As soon as funds will take profits, we could see and massive correction. $50.000 is the first support zone, $42.000/$44.000 is the second main support zone.
My new girlfriend. JTO!!!A large triangle formation has formed on the JTO chart, and before breaking out anywhere, it may pull back towards the 1.93 region and then experience a nice increase.
NOTE: Unlike others, this analysis has not been thoroughly researched due to personal reasons and has been looked at only instinctively. If you have the opportunity and time, looking at other sources related to JTO may be more beneficial for you. Good day, and profitable trades.
Bitcoin (BTC) technical and fundamental analysis📈 Technical analysis BTC/USDT
Bitcoin price has reached all targets from our previous review and set a new local high at $57,400. The driving force behind this growth impulse was the record inflow of funds into spot Bitcoin ETFs. Additionally, fundamental factors such as the upcoming halving and the rise of the US stock market in anticipation of the Fed's move to lower the key interest rate also contributed to this.
Thus, the BTC price has consolidated above the key level of $50,000 and broken above the resistance trendline. Currently, we anticipate a local correction and trading within the 4-hour Imbalance zone to fill in the gaps at horizontal levels of trading volumes. In this zone, a retest of the dynamic support line EMA 50 4H should occur, which will determine the direction of further price movement.
If the price consolidates above it, we expect a test of the $60,000 level. However, considering that the RSI indicator is in extreme overbought territory, there is a high probability of further correction continuation and a retest of the psychological level of $50,000. The next correction targets could be the mirror level of $48,000 and the trendline at the $44,000 level, which are within the range of 0.61 - 0.78 Fibonacci levels, respectively.
📉 Bitcoin market global analysis
On a global scale, the price of BTC has reached exactly the 0.78 Fibonacci correction level from the entire decline since 2021. If it manages to consolidate above it, it would indicate that it's not just a correction anymore, but Bitcoin's price has transitioned to a full-fledged pre-halving bull rally. However, historically, Bitcoin has experienced a correction before each halving. RSI indicator readings are again in the strong overbought zone, and the fear and greed index is in the extreme greed zone. Considering that we haven't had any serious correction since October 2023, all conditions are now forming for its onset. If Bitcoin can maintain its growth momentum until the halving, then after it, we can expect a global correction of all growth since 2023. The halving itself could be a signal to sell, based on the cryptocurrency reaching a local peak, similar to what happened following the approval of spot Bitcoin ETFs in the US in January 2024. In this case, we would expect a correction in the range of 0.5-0.68 Fibonacci levels and a retest of the 200-week moving average. Also, in this area lies the Imbalance 1W zone of 34,000-31,000, where it is necessary to fill gaps at horizontal levels of trading volumes.
💠 Analysis of zones and levels for making trading decisions
The Fear and Greed Index is in the extreme greed zone at 79.
The total market capitalization of the cryptocurrency market has increased to 2,087 billion dollars, and the Bitcoin dominance index has risen to 53.65.
According to the analysis of the accumulation of large order blocks in exchange order books, demand and supply zones are located at the following levels:
🟢 Demand Zone: 30000 - 40000
🔴 Supply Zone: 60000 - 68000
Levels for long positions:
50,000 - Retest of the key psychological level
48,000 - Significant support block
44,000-45,000 - Potential retest zone of the trendline
Levels for short positions:
60,000 - Test of key psychological resistance level
62,000 - 64,000: Major resistance block
68,000 - 70,000: Test of Bitcoin's historical maximum
📊 Fundamental analysis
The current rise in the price of Bitcoin has been supported by the deadline for settlements on BTC futures contracts. Additionally, there are several fundamental reasons:
Increase in the inflow of funds into cryptocurrency funds: Trading volume of spot Bitcoin ETFs hit a record $2.4 billion. Nine new spot Bitcoin ETFs set a new record for total daily volume.
Bullish rally ahead of the Bitcoin halving, which is 50 days away.
Rise in the US stock market, driven by expectations of the Fed's transition to lowering the key interest rate. This also sparks interest from large investors in digital assets.
The S&P500 index of the largest US companies has again hit its historical maximum, while the DXY dollar index continues its local correction.
🌐 Upcoming Events in the Global Economy
The following dates are expected to bring increased volatility in both the stock and cryptocurrency markets:
➤ 28.02, 16:30 - US GDP data.
➤ 8.03, 16:30 - Data on the unemployment rate in the USA.
➤ 12.03, 16:30 - Consumer inflation index in the USA (CPI).
➤ 20.03, 21:00 - New decision on the Fed interest rate.
📈 Results of signals from our AI trading indicator:
Our trading AI Indicator, as always in advance, predicted the current price action and gave the most profitable entry points into long positions with minimal risk. Thanks to the latest updates, maximum take profit levels have already been taken, and the price movement according to the latest signals on the spot was:
BTC +10.80%
ETH +10.34%
LTC +10.15%
In addition, I would like to share the forecast of the latest Bitcoin price action by our AI, which not only indicates the direction, but also builds the trajectory of further price movement:
BITCOIN is creating a potential Cup & Handle formation.BTC is currently, potentially creating a smaller Cup & Handle formation. (In white) And, a potentially larger Cup & Handle formation. (In Blue)
Bitcoin has been on an absolute tear the past few days, and these formations could come into play down the road if price action continues to fill them out. Whether it will be the smaller (White) Cup & Handle, the larger (Blue), or a Cup & Handle pattern at all remains to be seen, but will become clearer in the coming weeks/months.
These formations are speculation at this point, but I just wanted to point out the potential for each to occur down the road if the current trend continues.
Good luck, and always use a stop loss.
Correction in Bitcoin and a new buying opportunity.Bitcoin reaching the supply zones of 55750 and 58300 could trigger a correction and create a new buying opportunity for Bitcoin. Currently, the demand zones of 50400 and 48300 are of interest to me, which could be suitable for a purchase. It seems that the price, after hitting these two supply zones, may experience significant growth.
BTC BITCOIN Technical Analysis and Trade Idea#BTC's recent bullish run has been noteworthy. However, I'm watching for a potential buying opportunity if we see a decisive retracement down to the 61.8 Fibonacci level. A subsequent retest and failure of a range at the low around the current support level formed during that pullback would provide a strong entry signal for #Bitcoin. As always, it's crucial to remember the inherent risks of trading. Conduct your own thorough research, factoring in fundamental market drivers and the broader macroeconomic landscape alongside your technical analysis. Never neglect sound risk management strategies to protect your capital.
Disclaimer: This analysis offers a technical perspective on BTC and should not be taken as investment advice. Tailor your trading decisions to your specific risk tolerance, informed by comprehensive market research and a holistic assessment of all relevant factors.
BTC / BTCUSDTGood Luck >>
• Warning •
Any deal I share does not mean that I am forcing you to enter into it, you enter in with your full risk, because I'll not gain any profits with you in the end.
The risk management of the position must comply with the stop loss.
(I am not sharing financial or investment advice, you should do your own research for your money.)
Bitcoin's upper price limit will exceed $190K in 2025.In my long-term strategy, I have deeply explored the key factors influencing the price of Bitcoin. By precisely calculating the correlation between these factors and the price of Bitcoin, I found that they are closely linked to the value of Bitcoin. To more effectively predict the fair price of Bitcoin, I have built a predictive model .
Based on historical experience, the limit value of price deviation has been determined, and the upper and lower limits of the price have been calculated. Observing the price of Bitcoin and the price upper and lower limits can guide trading. According to current data, calculate the upper limit of Bitcoin price in 2025.
Historical simulations prove that, the prediction results of this model correspond quite high with actual values, fully demonstrating its reliability in predicting price fluctuations.
When the future is uncertain and the outlook is unclear, people often choose to hold back and avoid risks, or even abandon their original plans. However, the prediction of Bitcoin is full of challenges, but I have taken the first step in exploring.
📖 Table of contents:
🏃 Step 1: Identify the factors that have the greatest impact on Bitcoin price
🏃 Step 2: Build a Bitcoin price prediction model
🏃 Step 3: Find indicators for warning of bear market bottoms and bull market tops
🏃 Step 4: Predict Bitcoin Price in 2025
🏃 Step 5: Verify the performance of indicators for warning
🏃 Step 1: Identify the factors that have the greatest impact on Bitcoin price
📖 Correlation Coefficient: A mathematical concept for measuring influence
In order to predict the price trend of Bitcoin, we need to delve into the factors that have the greatest impact on its price. These factors or variables can be expressed in mathematical or statistical correlation coefficients. The correlation coefficient is an indicator of the degree of association between two variables, ranging from -1 to 1. A value of 1 indicates a perfect positive correlation, while a value of -1 indicates a perfect negative correlation.
For example, if the price of corn rises, the price of live pigs usually rises accordingly, because corn is the main feed source for pig breeding. In this case, the correlation coefficient between corn and live pig prices is approximately 0.3. This means that corn is a factor affecting the price of live pigs. On the other hand, if a shooter's performance improves while another shooter's performance deteriorates due to increased psychological pressure, we can say that the former is a factor affecting the latter's performance.
Therefore, in order to identify the factors that have the greatest impact on the price of Bitcoin, we need to find the factors with the highest correlation coefficients with the price of Bitcoin. If, through the analysis of the correlation between the price of Bitcoin and the data on the chain, we find that a certain data factor on the chain has the highest correlation coefficient with the price of Bitcoin, then this data factor on the chain can be identified as the factor that has the greatest impact on the price of Bitcoin. Through calculation, we found that the 🔵 number of Bitcoin blocks is one of the factors that has the greatest impact on the price of Bitcoin. From historical data, it can be clearly seen that the growth rate of the 🔵 number of Bitcoin blocks is basically consistent with the movement direction of the price of Bitcoin. By analyzing the past ten years of data, we obtained a daily correlation coefficient of 0.93 between the number of Bitcoin blocks and the price of Bitcoin.
🏃 Step 2: Build a Bitcoin price prediction model
📖 Predictive Model: What formula is used to predict the price of Bitcoin?
Among various prediction models, the linear function is the preferred model due to its high accuracy. Take the standard weight as an example, its linear function graph is a straight line, which is why we choose the linear function model. However, the growth rate of the price of Bitcoin and the number of blocks is extremely fast, which does not conform to the characteristics of the linear function. Therefore, in order to make them more in line with the characteristics of the linear function, we first take the logarithm of both. By observing the logarithmic graph of the price of Bitcoin and the number of blocks, we can find that after the logarithm transformation, the two are more in line with the characteristics of the linear function. Based on this feature, we choose the linear regression model to establish the prediction model.
From the graph below, we can see that the actual red and green K-line fluctuates around the predicted blue and 🟢 green line. These predicted values are based on fundamental factors of Bitcoin, which support its value and reflect its reasonable value. This picture is consistent with the theory proposed by Karl Marx in "Capital" that "prices fluctuate around values."
The predicted logarithm of the market cap of Bitcoin is calculated through the model. The specific calculation formula of the Bitcoin price prediction value is as follows:
btc_predicted_marketcap = math.exp(btc_predicted_marketcap_log)
btc_predicted_price = btc_predicted_marketcap / btc_supply
🏃 Step 3: Find indicators for early warning of bear market bottoms and bull market tops
📖 Warning Indicator: How to Determine Whether the Bitcoin Price has Reached the Bear Market Bottom or the Bull Market Top?
By observing the Bitcoin price logarithmic prediction chart mentioned above, we notice that the actual price often falls below the predicted value at the bottom of a bear market; during the peak of a bull market, the actual price exceeds the predicted price. This pattern indicates that the deviation between the actual price and the predicted price can serve as an early warning signal. When the 🟠 Bitcoin price deviation is very low, as shown by the chart with 🟩 green background, it usually means that we are at the bottom of the bear market; Conversely, when the 🟠 Bitcoin price deviation is very high, the chart with a 🟥 red background indicates that we are at the peak of the bull market.
This pattern has been validated through six bull and bear markets, and the deviation value indeed serves as an early warning signal, which can be used as an important reference for us to judge market trends.
The calculation formula for the price deviation of Bitcoin is as follows:
btc_price_bias = btc_marketcap_log - btc_predicted_marketcap_log
Specifically, we can find the rule by watching the Bitcoin price log and the Bitcoin price deviation chart. For example, on August 25, 2015, the 🔴Bitcoin price deviation was at its lowest value of -1.11; on December 17, 2017, the
🔴Bitcoin price deviation was at its highest value at the time, 1.69; on March 16, 2020, the
🔴Bitcoin price deviation was at its lowest value at the time, -0.91; on March 13, 2021, the
🔴Bitcoin price deviation was at its highest value at the time, 1.1; on December 31, 2022, the
🔴Bitcoin price deviation was at its lowest value at the time, -1.
For conservative reasons, we set the lower limit value of the Bitcoin price deviation warning indicator to the larger of the three lowest values, -0.9, and the upper limit value to the smaller of the two highest values, 1.
When we add the upper and lower limit values of the Bitcoin price deviation to the forecast price, we obtain the 🟠 upper limit and 🟤 lower limit of the price. This can intuitively guide trading. When the Bitcoin price is below the price lower limit, buy. When the Bitcoin price is above the price upper limit, sell.
The calculation formula for the upper and lower limits of the price is as follows:
btc_price_upper_limit = math.exp(btc_predicted_price_log + btc_price_bias_upper_limit)
btc_price_lower_limit = math.exp(btc_predicted_price_log + btc_price_bias_lower_limit)
🏃 Step 4: Predict Bitcoin Price in 2025
According to the data calculated on February 25, 2024, the upper limit of the Bitcoin price is $194,287, which is the price ceiling of this bull market. The peak of the last bull market was on November 9, 2021, at $68,664. The bull-bear market cycle is 4 years, so the highest point of this bull market is expected in 2025, and the upper limit of the Bitcoin price will exceed $190,000. The closing price of Bitcoin on February 25, 2024, was $51,729, with an expected increase of 2.7 times.
🏃 Step 5: Verify the performance of indicators for warning
📖 Model accuracy validation: How to judge the accuracy of the Bitcoin price model?
The accuracy of the model is represented by the coefficient of determination R square, which reflects the degree of match between the predicted value and the actual value. I divided all the historical data from August 18, 2015 into two groups, and used the data from August 18, 2011 to August 18, 2015 as training data to generate the model. The calculation result shows that the coefficient of determination R squared during the 2011-2015 training period is as high as 0.81, which shows that the accuracy of this model is quite high. From the Bitcoin price logarithmic prediction chart in the figure below, we can see that the deviation between the predicted value and the actual value is not far, which means that most of the predicted values can explain the actual value well.
The calculation formula for the coefficient of determination R square is as follows:
residual = btc_close_log - btc_predicted_price_log
residual_square = residual * residual
train_residual_square_sum = math.sum(residual_square, train_days)
train_mse = train_residual_square_sum / train_days
train_r2 = 1 - train_mse / ta.variance(btc_close_log, train_days)
📖 Model reliability verification: How to affirm the reliability of the Bitcoin price model when new data is available?
Model reliability is achieved through model verification. I set the last day of the training period to February 2, 2024 as the "verification group" and used it as verification data to verify the reliability of the model. This means that after generating the model if there is new data, I will use these new data together with the model for prediction, and then evaluate the accuracy of the model. If the coefficient of determination when using verification data is close to the previous training one and both remain at a high level, then we can consider this model as reliable. The coefficient of determination calculated from the validation period data and model prediction results is as high as 0.83, which is close to the previous 0.81, further proving the reliability of this model.
📖 Strategy: When to buy or sell, and how many to choose?
We introduce the Bitcoin 5A strategy. This strategy requires us to generate trading signals based on the critical values of the warning indicators, simulate the trades, and collect performance data for evaluation. In the Bitcoin 5A strategy, there are three key parameters: buying warning indicator, batch trading days, and selling warning indicator. Batch trading days are set to ensure that we can make purchases in batches after the trading signal is sent, thus buying at a lower price, selling at a higher price, and reducing the trading impact cost.
In order to find the optimal warning indicator critical value and batch trading days, we need to adjust these parameters repeatedly and perform backtesting. Backtesting is a method established by observing historical data, which can help us better understand market trends and trading opportunities.
When the warning indicator Bitcoin price deviation is below -0.9, that is, when the Bitcoin price is lower than the lower price limit, buy. When it is higher than 1, that is, when the Bitcoin price is higher than the upper price limit, sell.
In addition, we set the batch trading days as 25 days to implement a strategy that averages purchases and sales. Within these 25 days, we will invest all funds into the market evenly, buying once a day. At the same time, we also sell positions at the same pace, selling once a day.
📖 Adjusting the threshold: a key step to optimizing trading strategy
Adjusting the threshold is an indispensable step for better performance. Here are some suggestions for adjusting the batch trading days and critical values of warning indicators:
- Batch trading days: Try different days like 25 to see how it affects overall performance.
- Buy and sell critical values for warning indicators: iteratively fine-tune the buy threshold value of -0.9 and the sell threshold value of 1 exhaustively to find the best combination of threshold values.
Through such careful adjustments, we may find an optimized approach with a lower maximum drawdown rate (e.g., 11%) and a higher cumulative return rate for closed trades (e.g., 474 times). The chart below is a backtest optimization chart for the Bitcoin 5A strategy, providing an intuitive display of strategy adjustments and optimizations.
In this way, we can better grasp market trends and trading opportunities, thereby achieving a more robust and efficient trading strategy.
📖 Performance evaluation: How to accurately evaluate historical backtesting results?
After detailed strategy testing, to ensure the accuracy and reliability of the results, we need to carry out a detailed performance evaluation on the backtest results. The key evaluation indices include:
- Net value curve: As shown in the rose line, it intuitively reflects the growth of the account net value. By observing the net value curve, we can understand the overall performance and profitability of the strategy.
The basic attributes of this strategy are as follows:
Trading range: 2015-8-19—2024-2-18, backtest range: 2011-8-18—2024-2-18
Initial capital: 1000USD, order size: 1 contract, pyramid: 50 orders, commission rate: 0.2%, slippage: 20 markers.
In the strategy tester overview chart, we also obtained the following key data:
- Net profit rate of closed trades: as high as 474 times, far exceeding the benchmark, as shown in the strategy tester performance summary chart, Bitcoin buys and holds 210 times.
- Number of closed trades and winning percentage: 100 trades were all profitable, showing the stability and reliability of the strategy.
- Drawdown rate & win-loose ratio: The maximum drawdown rate is only 11%, far lower than Bitcoin's 78%. Profit factor, or win-loose ratio, reached 500, further proving the advantage of the strategy.
Through these detailed evaluations, we can see clearly the excellent balance between risk and return of the Bitcoin 5A strategy.
BTC / USDT Next Move CRYPTOCAP:BTC USDT Next Move ???
Bitcoin, Keep an eye on, Short term active trade.
Feeling like this kind of trigger.
GETTEX:46K to GETTEX:48K 🧲
Bitcoin Ready to 52KPositive momentum continues in the crypto market, with Bitcoin showcasing promise and altcoins displaying significant resilience despite recent dips. While I won't confidently declare a major bull market, my portfolio is positioned for one, as it has been since the start of 2023. I made adjustments about two months ago, especially with SOL where I realized gains after a strong upward movement.
My perspective remains bullish as long as Bitcoin maintains levels above 40,000. Sustaining above this mark could signal a robust push towards 50,000 and beyond. Even a dip below 40,000 doesn't rule out new highs for 2023/2024, but it could limit the potential. I currently see a likelihood of hitting 50,000 in the near term, potentially even within days if we break past the 44/45,000 resistance. However, market dynamics will shape further projections.
For now, a short-term outlook involves aiming to sustain levels around 42,000, forming higher lows in a triangular pattern. A touch at 44/44.5,000 would bolster the case for an imminent breakout. If resistance at 44/45,000 is breached, a swift move towards 47/48,000 is anticipated within a day or so.
In line with my previous analysis, version 2 of my strategy remains active. A strong breakout could set a preliminary target between 50,000 to 55,000.
In summary, as long as we hold above 42,000 in the coming days, the upside potential appears significant.
I wanted to share a chart I posted two months ago, though at the time, I expressed doubts about a similar outcome. While I still find it unlikely, recent market trends are much more encouraging. However, it's important not to fixate too much on historical charts. 😊
BTC BITCOIN Technical Analysis & Trade IdeaBitcoin (BTC) has enjoyed a robust bullish run, but recent price action on the four-hour 4H chart indicates potential weakness. Since February 13th, BTC has entered a sideways consolidation phase. I'm anticipating a sell opportunity should we observe a decisive break below the current range low, followed by a retest and failure of that level. Potential targets for this trade would align with prior swing lows.
It's imperative to emphasize that trading carries inherent risk. Before executing any trades, it's vital to conduct your own extensive research. Consider both fundamental market drivers and global macroeconomic conditions alongside your technical analysis. Always implement sound risk management practices to safeguard your investment.
Disclaimer: This analysis presents a technical viewpoint on Bitcoin. It should not be interpreted as investment advice. Base your trading decisions on your own risk profile, comprehensive market research, and a thorough assessment of all relevant variables.
HOW-TO use Bitcoin 5A Strategy@LilibtcIn our long-term strategy, we have deeply explored the key factors influencing the price of Bitcoin. By precisely calculating the correlation between these factors and the price of Bitcoin, we found that they are closely linked to the value of Bitcoin. To more effectively predict the fair price of Bitcoin, we have built a predictive model and adjusted our investment strategy accordingly based on this model. In practice, the prediction results of this model correspond quite high with actual values, fully demonstrating its reliability in predicting price fluctuations.
When the future is uncertain and the outlook is unclear, people often choose to hold back and avoid risks, or even abandon their original plans. However, the prediction of Bitcoin is full of challenges, but we have taken the first step in exploring.
Table of contents:
Guide
Step 1: Identify the factors that have the greatest impact on Bitcoin price
Step 2: Build a Bitcoin price prediction model
Step 3: Find indicators for warning of bear market bottoms and bull market tops
Step 4: Develop a Bitcoin 5A strategy
Step 5: Verify the performance of the Bitcoin 5A strategy
Opportunities
Usage Restrictions
Guide:
1. On the main interface, modify the code, find the BTCUSD trading pair, and select the BITSTAMP exchange for trading.
2. Set the time period to the daily chart.
3. Select a logarithmic chart in the chart type to better identify price trends.
4. In the strategy settings, adjust the options according to personal needs, including language, display indicators, display strategies, display performance, display optimizations, sell alerts, buy prompts, opening days, backtesting start year, backtesting start month, and backtesting start date.
Step 1: Identify the factors that have the greatest impact on Bitcoin price
Correlation Coefficient: A mathematical concept for measuring influence
In order to predict the price trend of Bitcoin, we need to delve into the factors that have the greatest impact on its price.
These factors or variables can be expressed in mathematical or statistical correlation coefficients. The correlation coefficient is an indicator of the degree of association between two variables, ranging from -1 to 1. A value of 1 indicates a perfect positive correlation, while a value of -1 indicates a perfect negative correlation.
For example, if the price of corn rises, the price of live pigs usually rises accordingly, because corn is the main feed source for pig breeding. In this case, the correlation coefficient between corn and live pig prices is approximately 0.3. This means that corn is a factor affecting the price of live pigs. On the other hand, if a shooter's performance improves while another shooter's performance deteriorates due to increased psychological pressure, we can say that the former is a factor affecting the latter's performance.
Therefore, in order to identify the factors that have the greatest impact on the price of Bitcoin, we need to find the factors with the highest correlation coefficients with the price of Bitcoin. If, through the analysis of the correlation between the price of Bitcoin and the data on the chain, we find that a certain data factor on the chain has the highest correlation coefficient with the price of Bitcoin, then this data factor on the chain can be identified as the factor that has the greatest impact on the price of Bitcoin. Through calculation, we found that the 🔵number of Bitcoin blocks is one of the factors that has the greatest impact on the price of Bitcoin. From historical data, it can be clearly seen that the growth rate of the 🔵number of Bitcoin blocks is basically consistent with the movement direction of the price of Bitcoin. By analyzing the past ten years of data, we obtained a daily correlation coefficient of 0.93 between the number of Bitcoin blocks and the price of Bitcoin.
Step 2: Build a Bitcoin price prediction model
Predictive Model: What formula is used to predict the price of Bitcoin?
Among various prediction models, the linear function is the preferred model due to its high accuracy. Take the standard weight as an example, its linear function graph is a straight line, which is why we choose the linear function model.
However, the growth rate of the price of Bitcoin and the number of blocks is extremely fast, which does not conform to the characteristics of the linear function. Therefore, in order to make them more in line with the characteristics of the linear function, we first take the logarithm of both. By observing the logarithmic graph of the price of Bitcoin and the number of blocks, we can find that after the logarithm transformation, the two are more in line with the characteristics of the linear function. Based on this feature, we choose the linear regression model to establish the prediction model.
From the graph below, we can see that the actual red and green K-line fluctuates around the predicted blue and 🟢green line. These predicted values are based on fundamental factors of Bitcoin, which support its value and reflect its reasonable value. This picture is consistent with the theory proposed by Marx in "Das Kapital" that "prices fluctuate around values."
The predicted logarithm of the market cap of Bitcoin is calculated through the model. The specific calculation formula of the Bitcoin price prediction value is as follows:
btc_predicted_marketcap = math.exp(btc_predicted_marketcap_log)
btc_predicted_price = btc_predicted_marketcap / btc_supply
Step 3: Find indicators for early warning of bear market bottoms and bull market tops
Warning Indicator: How to Determine Whether the Bitcoin Price has Reached the Bear Market Bottom or the Bull Market Top?
By observing the Bitcoin price logarithmic prediction chart mentioned above, we notice that the actual price often falls below the predicted value at the bottom of a bear market; during the peak of a bull market, the actual price exceeds the predicted price. This pattern indicates that the deviation between the actual price and the predicted price can serve as an early warning signal. When the 🟠Bitcoin price deviation is very low, as shown by the chart with 🟩green background, it usually means that we are at the bottom of the bear market;
Conversely, when the 🟠Bitcoin price deviation is very high, the chart with a 🟥red background indicates that we are at the peak of the bull market.
This pattern has been validated through six bull and bear markets, and the deviation value indeed serves as an early warning signal, which can be used as an important reference for us to judge market trends.
Step 4: Bitcoin 5A Strategy Formulation
Strategy: When to buy or sell, and how many to choose?
We introduce the Bitcoin 5A strategy. This strategy requires us to generate trading signals based on the critical values of the warning indicators, simulate the trades, and collect performance data for evaluation. In the Bitcoin 5A strategy, there are three key parameters: buying warning indicator, batch trading days, and selling warning indicator. Batch trading days are set to ensure that we can make purchases in batches after the trading signal is sent, thus buying at a lower price, selling at a higher price, and reducing the trading impact cost.
In order to find the optimal warning indicator critical value and batch trading days, we need to adjust these parameters repeatedly and perform backtesting. Backtesting is a method established by observing historical data, which can help us better understand market trends and trading opportunities.
Specifically, we can find the key trading points by watching the Bitcoin price log and the Bitcoin price deviation chart.
For example, on August 25, 2015, the 🟠Bitcoin price deviation was at its lowest value of -1.11; on December 17, 2017, the 🟠Bitcoin price deviation was at its highest value at the time, 1.69; on March 16, 2020, the 🟠Bitcoin price deviation was at its lowest value at the time, -0.91; on March 13, 2021, the 🟠Bitcoin price deviation was at its highest value at the time, 1.1; on December 31, 2022, the 🟠Bitcoin price deviation was at its lowest value at the time, -1.
To ensure that all five key trading points generate trading signals, we set the warning indicator Bitcoin price deviation to the larger of the three lowest values, -0.9, and the smallest of the two highest values, 1. Then, we buy when the warning indicator Bitcoin price deviation is below -0.9, and sell when it is above 1.
In addition, we set the batch trading days as 25 days to implement a strategy that averages purchases and sales. Within these 25 days, we will invest all funds into the market evenly, buying once a day. At the same time, we also sell positions at the same pace, selling once a day.
Adjusting the threshold: a key step to optimizing trading strategy
Adjusting the threshold is an indispensable step for better performance. Here are some suggestions for adjusting the batch trading days and critical values of warning indicators:
• Batch trading days: Try different days like 25 to see how it affects overall performance.
• Buy and sell critical values for warning indicators: iteratively fine-tune the buy threshold value of -0.9 and the sell threshold value of 1 exhaustively to find the best combination of threshold values.
Through such careful adjustments, we may find an optimized approach with a lower maximum drawdown rate (e.g., 11%) and a higher cumulative return rate for closed trades (e.g., 474 times). The chart below is a backtest optimization chart for the Bitcoin 5A strategy, providing an intuitive display of strategy adjustments and optimizations.
In this way, we can better grasp market trends and trading opportunities, thereby achieving a more robust and efficient trading strategy.
Step 5: Validating the performance of the Bitcoin 5A Strategy
Model accuracy validation: How to judge the accuracy of the Bitcoin price model?
The accuracy of the model is represented by the coefficient of determination R square, which reflects the degree of match between the predicted value and the actual value. I divided all the historical data from August 18, 2015 into two groups, and used the data from August 18, 2011 to August 18, 2015 as training data to generate the model. The calculation result shows that the coefficient of determination R squared during the 2011-2015 training period is as high as 0.81, which shows that the accuracy of this model is quite high. From the Bitcoin price logarithmic prediction chart in the figure below, we can see that the deviation between the predicted value and the actual value is not far, which means that most of the predicted values can explain the actual value well.
The calculation formula for the coefficient of determination R square is as follows:
residual = btc_close_log - btc_predicted_price_log
residual_square = residual * residual
train_residual_square_sum = math.sum(residual_square, train_days)
train_mse = train_residual_square_sum / train_days
train_r2 = 1 - train_mse / ta.variance(btc_close_log, train_days)
Model reliability verification: How to affirm the reliability of the Bitcoin price model when new data is available?
Model reliability is achieved through model verification. I set the last day of the training period to February 2, 2024 as the "verification group" and used it as verification data to verify the reliability of the model. This means that after generating the model if there is new data, I will use these new data together with the model for prediction, and then evaluate the accuracy of the model. If the coefficient of determination when using verification data is close to the previous training one and both remain at a high level, then we can consider this model as reliable. The coefficient of determination calculated from the validation period data and model prediction results is as high as 0.83, which is close to the previous 0.81, further proving the reliability of this model.
Performance evaluation: How to accurately evaluate historical backtesting results?
After detailed strategy testing, to ensure the accuracy and reliability of the results, we need to carry out a detailed performance evaluation on the backtest results. The key evaluation indices include:
• Net value curve: As shown in the rose line, it intuitively reflects the growth of the account net value. By observing the net value curve, we can understand the overall performance and profitability of the strategy.
The basic attributes of this strategy are as follows:
Trading range: 2015-8-19—2024-2-18, backtest range: 2011-8-18—2024-2-18
Initial capital: 1000USD, order size: 1 contract, pyramid: 50 orders, commission rate: 0.2%, slippage: 20 markers.
In the strategy tester overview chart, we also obtained the following key data:
• Net profit rate of closed trades: as high as 474 times, far exceeding the benchmark, as shown in the strategy tester performance summary chart, Bitcoin buys and holds 210 times.
• Number of closed trades and winning percentage: 100 trades were all profitable, showing the stability and reliability of the strategy.
• Drawdown rate & win-loose ratio: The maximum drawdown rate is only 11%, far lower than Bitcoin's 78%. Profit factor, or win-loose ratio, reached 500, further proving the advantage of the strategy.
Through these detailed evaluations, we can see clearly the excellent balance between risk and return of the Bitcoin 5A strategy.
Opportunity: Capturing factor changes
Changes in factors provide us with valuable trading opportunities. The 🟠orange line in the chart below represents the factor indicator when its value on February 20, 2024 is -0.32, which is greater than the threshold of -0.9. This could be a signal worth paying attention to. Opportunities like this do not come up often, so we need to stay alert and act fast.
Usage Restrictions: Strategy Application in Specific Situations
Please note that this strategy is designed specifically for Bitcoin and should not be applied to other assets or markets without authorization. In actual operations, we should make careful decisions according to our risk tolerance and investment goals.
