BEST TIME TO BUY BITCOIN? Cryptocurrency Price Guide Bitcoin Mayer Multiple

Bitcoin Mayer Multiple Chart 1

starting with our first metric out of five the bitcoin mayor multiple

introduced by trace mayor as a way to gauge the current price of bitcoin against its long-range historical price movements I E 200-day moving average

the mayor multiple highlights when bitcoin is overbought or oversold in the context of longer time frames

the mayor multiple is calculated by dividing the current bitcoin price by the 200-day moving average of that price

so we see the yellow is bitcoin's price through history and of course we see big peaks and big valleys indicating is the current price of bitcoin overbought or oversold and you can see the mere multiple is getting less volatile over time it is worth noting as the market becomes larger and less volatile the peaks are becoming less exaggerated

this is because a 200-day moving average baseline is a statistic yardstick against an ever-growing more stable bitcoin market

so you as an individual always have to keep that calibration in mind meaning this metric probably is never gonna get back to those highs ultra highs and ultra lows of those peaks and valleys

so let's get to it

what is the current metric telling us ?

right now with the bitcoin price, around forty-one thousand dollars the current mayor multiple is 0.86 and historically anything under a 2.4 has been a historically good buy

why 2.4 ?

well simulations performed by trace mayor determine that in the past the best long-term results were achieved by accumulating bitcoin whenever the mere multiple was below 2.4 since these simulations were based on historical data, they are purely educational and should not be the basis of any financial decision

so here is the chart this line represents 2.4 and anything historically whenever the bitcoin price has been under a 2.4 percent mere multiple

that was historically a great time to buy and what do you notice you notice that most times in bitcoin's history was a great time to buy in fact the average mayor multiple since the creation of bitcoin was 1.42 the mayor multiple has also historically been higher than today's value 0.86

78 of the time so this is telling us that bitcoin's a great value right now it's saying the market is oversold for bitcoin

The Puell Multiple (Chart 2)

let's look at the pool multiple or 12 multiples however you pronounce it

the pool multiple graphs is showing the relation between the BTC mined in a day expressed in us dollars and The 365-day simple moving average

 now if that still doesn't make sense let's dig into it puell multiple explained

 the Powell multiple is a market metric for estimating the level of cell pressure in the market coming from miners

 historically mining revenue primarily consisted of block subsidies awarded to a miner for finding a block so as you know the last bitcoin won't be mined for over a hundred years and about every 10 minutes a block gets mined and those miners get a little bit of bitcoin as a reward

the USD value of that reward of that subsidy changes on a daily basis as the price of bitcoin changes traders found it useful to consider the value of the block subsidy to determine what sorts of pressures miners faced to sell these rewards to continue operations since four sellers in the market tend to bring down the price

so obviously the miners are running a business eventually after they get that mining reward they do plan to sell and to better gauge that potential cell pressure enter analyst David pull

 the issue with only looking at daily minor revenue is that it does not tell you how healthy that revenue is over a period of time

so Powell developed the 12 multiple

rights, because miners don't usually sell that day bitcoin miners, are actually pretty in tune with the market and historically they have shown to wait till bull markets wait until bullish price action

so how is it calculated well, it's calculated by taking the miner's revenue meaning that the daily coin issuance they get plus the fees because miners also take fees divided by the previous year's daily moving average of the miner's revenue and it just tells us are the miners more incentivized to sell or are they more incentivized to hold?

so what is this telling us first off the puell multiple ranges anywhere from 0 all the way to 20?

there is no magic number to tell us oh after it gets past this certain number that's when they have the ultimate cell pressure it's always just a range for example back in 2016 and 2017 that run up from 1k to 20k it's not like the coin issuance per block changed at all same amount of bitcoin got awarded with every block

 but as the network became more popular not only did the fees per transaction go up but as the value of each bitcoin just generally went up as more people bought putting that into context comparison over the last 365 days for miners

that was cell pressure that was clear cell pressure back in 2019 as well as back in march of 2021 we saw cell pressure as well it got up to I would say three 3.5 may be back in 2019 got right up past over two right now the pool multiple is seeing lower lows and lower lows it is sitting under one meaning that right now bitcoin miners are incentivized to huddle the cell pressure that we may have seen six 12 months ago we are not seeing today that's telling us that's a bullish signal for the market the 12 multiple could always get lower anything could always get lower but again you are never going to get the exact bottoms best thing to do is dollar-cost average in on the way down and then sell dollar cost average out on the way up that's my move