Pi Cycle top signal: are you ready to buy BTC right now?Pi Cycle Bottom indicator has given a BUY signal, who is willing to strongly believe in the recovery of BTC in the near future?
Pi-cycle-bottom
🔥 Bitcoin Pi-Cycle Bottom Indicator Signals Bear Market BottomBefore we dive deeper into the analysis I want to give a quick overview of what the pi-cycle bottom indicator is,
"The indicator comprises a 471-day simple moving average (SMA) and a 150-period exponential moving average (EMA). Furthermore, the 471-day SMA is multiplied by 0.745; the outcome is pitted against the 150-day EMA to predict the underlying market's bottom."
In short, the Pi-Cycle bottom indicator is similar too the Pi-Cycle top indicator, but with different values.
Historically, the Pi-Cycle bottom indicator has signaled the BTC bear-market bottom within 3 days of the signal. This would mean that the BTC bottom will be in within the next three days.
However, will the pi-cycle bottom indicator work again this time? There's only two previous instances of the indicator working, one can't really deduce statistical validity from an N=2. Funnily enough, people said the same thing about the Pi-Cycle top indicator last year. In hindsight, the Pi-Cycle top indicator did a great job signaling the technical top for the current BTC cycle (technical top = top based on indicators and on-chain metrics).
Will this time be different? Maybe.
The current macro-economic outlook is vastly different from the previous cycles. Bitcoin's correlation with the stock market has never been this high and, with inflation still on the rise and a recession looming, stocks are more likely to go down than to go up in the near-future. Unless today's CPI numbers will cause a huge 20%-30% sell-off, I don't think that BTC will bottom within the next three days. Time will tell.
Nevertheless, I think that this indicator is one of the better bear-market bottom indicators. Bottoms never occur when people expect it.
Pi-Cycle Bottom Will Cross Tomorrow Most LikelyThe Pi-Cycle Bottom will most likely cross tomorrow.
If the indicator remains predictive, and consistent with itself, the bottom should occur within a few days of it crossing.
This would imply significant downside coinciding with an important CPI/Fed meeting this week.
There is precedent for the indicator crossing and BTCUSD falling -40% within the following few days.
I've wavered quite a lot on the question of whether the macro bottom is in. Mostly due to Ben Cowen's credibility and views, I'm currently leaning towards the bottom not being in and significant downside still to come. The pi-cycle bottom crossing in this context may impy we will see a large downside move in the next week.
Pi Cycle Bottom IndicatorFor people who are interested in following the Pi Cycle Bottom indicator. I am glad some other people programmed this indicator kudos to them.
