Bitcoin Macro Trend Map [Ox_kali]

18 Jul

## Introduction
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The “Bitcoin Macro Trend Map” script is designed to provide a comprehensive analysis of Bitcoin’s macroeconomic trends. By leveraging a unique combination of Bitcoin-specific macroeconomic indicators, this script helps traders identify potential market peaks and troughs with greater accuracy. It synthesizes data from multiple sources to offer a probabilistic view of market excesses, whether overbought or oversold conditions.

This script offers significant value for the following reasons:

1. Holistic Market Analysis: It integrates a diverse set of indicators that cover various aspects of the Bitcoin market, from investor sentiment and market liquidity to mining profitability and network health. This multi-faceted approach provides a more complete picture of the market than relying on a single indicator.
2. Customization and Flexibility: Users can customize the script to suit their specific trading strategies and preferences. The script offers configurable parameters for each indicator, allowing traders to adjust settings based on their analysis needs.
3. Visual Clarity: The script plots all indicators on a single chart with clear visual cues. This includes color-coded indicators and background changes based on market conditions, making it easy for traders to quickly interpret complex data.
4. Proven Indicators: The script utilizes well-established indicators like the EMA, NUPL, PUELL Multiple, and Hash Ribbons, which are widely recognized in the trading community for their effectiveness in predicting market movements.
5. A New Comprehensive Indicator: By integrating background color changes based on the aggregate signals of various indicators, this script essentially creates a new, comprehensive indicator tailored specifically for Bitcoin. This visual representation provides an immediate overview of market conditions, enhancing the ability to spot potential market reversals.

Optimal for use on timeframes ranging from 1 day to 1 week, the “Bitcoin Macro Trend Map” provides traders with actionable insights, enhancing their ability to make informed decisions in the highly volatile Bitcoin market. By combining these indicators, the script delivers a robust tool for identifying market extremes and potential reversal points.


## Key Indicators
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• Macroeconomic Data: The script combines several relevant macroeconomic indicators for Bitcoin, such as the 10-month EMA, M2 money supply, CVDD, Pi Cycle, NUPL, PUELL, MRVR Z-Scores, and Hash Ribbons (Full description bellow).
  
• Open Source Sources: Most of the scripts used are sourced from open-source projects that I have modified to meet the specific needs of this script.
  
• Recommended Timeframes: For optimal performance, it is recommended to use this script on timeframes ranging from 1 day to 1 week.
  
• Objective: The primary goal is to provide a probabilistic solution to identify market excesses, whether overbought or oversold points.
  

## Originality and Purpose
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This script stands out by integrating multiple macroeconomic indicators into a single comprehensive tool. Each indicator is carefully selected and customized to provide insights into different aspects of the Bitcoin market. By combining these indicators, the script offers a holistic view of market conditions, helping traders identify potential tops and bottoms with greater accuracy. This is the first version of the script, and additional macroeconomic indicators will be added in the future based on user feedback and other inputs.

## How It Works
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The script works by plotting each macroeconomic indicator on a single chart, allowing users to visualize and interpret the data easily. Here’s a detailed look at how each indicator contributes to the analysis:

• EMA 10 Monthly: Uses an exponential moving average over 10 monthly periods to signal bullish and bearish trends. This indicator helps identify long-term trends in the Bitcoin market by smoothing out price fluctuations to reveal the underlying trend direction.Moving Averages w/ 18 day/week/month.
  Credit to ryanman0
• M2 Money Supply: Analyzes the evolution of global money supply, indicating market liquidity conditions. This indicator tracks the changes in the total amount of money available in the economy, which can impact Bitcoin’s value as a hedge against inflation or economic instability.
  Credit to dylanleclair
• CVDD (Cumulative Value Days Destroyed): An indicator based on the cumulative value of days destroyed, useful for identifying market turning points. This metric helps assess the Bitcoin market’s health by evaluating the age and value of coins that are moved, indicating potential shifts in market sentiment.
  Credit to Da_Prof
• Pi Cycle: Uses simple and exponential moving averages to detect potential sell points. This indicator aims to identify cyclical peaks in Bitcoin’s price, providing signals for potential market tops.
  Credit to NoCreditsLeft
• NUPL (Net Unrealized Profit/Loss): Measures investors’ unrealized profit or loss to signal extreme market levels. This indicator shows the net profit or loss of Bitcoin holders as a percentage of the market cap, helping to identify periods of significant market optimism or pessimism.
  Credit to Da_Prof
• PUELL Multiple: Assesses mining profitability relative to historical averages to indicate buying or selling opportunities. This indicator compares the daily issuance value of Bitcoin to its yearly average, providing insights into when the market is overbought or oversold based on miner behavior.
  Credit to Da_Prof
• MRVR Z-Scores: Compares market value to realized value to identify overbought or oversold conditions. This metric helps gauge the overall market sentiment by comparing Bitcoin’s market value to its realized value, identifying potential reversal points.
  Credit to Pinnacle_Investor
• Hash Ribbons: Uses hash rate variations to signal buying opportunities based on miner capitulation and recovery. This indicator tracks the health of the Bitcoin network by analyzing hash rate trends, helping to identify periods of miner capitulation and subsequent recoveries as potential buying opportunities.
  Credit to ROBO_Trading

## Indicator Visualization and Interpretation
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For each horizontal line representing an indicator, a legend is displayed on the right side of the chart. If the conditions are positive for an indicator, it will turn green, indicating the end of a bearish trend. Conversely, if the conditions are negative, the indicator will turn red, signaling the end of a bullish trend.

The background color of the chart changes based on the average of green or red indicators. This parameter is configurable, allowing adjustment of the threshold at which the background color changes, providing a clear visual indication of overall market conditions.

## Script Parameters
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The script includes several configurable parameters to customize the display and behavior of the indicators:

Color Style:

• Normal: Default colors.
  
• Modern: Modern color style.
  
• Monochrome: Monochrome style.
  
• User: User-customized colors.
  
• Custom color settings for up trends (Up Trend Color), down trends (Down Trend Color), and NaN (NaN Color)
  

Background Color Thresholds:

• Thresholds:Settings to define the thresholds for background color change.
  
• Low/High Red Threshold: Low and high thresholds for bearish trends.
  
• Low/High Green Threshold: Low and high thresholds for bullish trends.
  

Indicator Display:
Options to show or hide specific indicators such as EMA 10 Monthly, CVDD, Pi Cycle, M2 Money, NUPL, PUELL, MRVR Z-Scores, and Hash Ribbons.

Specific Indicator Settings:

• EMA 10 Monthly: Options to customize the period for the exponential moving average calculation.
  
• M2 Money: Aggregation of global money supply data.
  
• CVDD: Adjustments for value normalization.
  
• Pi Cycle: Settings for simple and exponential moving averages.
  
• NUPL: Thresholds for unrealized profit/loss values.
  
• PUELL: Adjustments for mining profitability multiples.
  
• MRVR Z-Scores: Settings for overbought/oversold values.
  
• Hash Ribbons: Options for hash rate moving averages and capitulation/recovery signals.
  

## Conclusion
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The “Bitcoin Macro Trend Map” by Ox_kali is a tool designed to analyze the Bitcoin market. By combining several macroeconomic indicators, this script helps identify market peaks and troughs. It is recommended to use it on timeframes from 1 day to 1 week for optimal trend analysis. The scripts used are sourced from open-source projects, modified to suit the specific needs of this analysis.

## Notes
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This is the first version of the script and it is still in development. More indicators will likely be added in the future. Feedback and comments are welcome to improve this tool.




## Disclaimer:
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Please note that the Open Interest liquidation map is not a guarantee of future market performance and should be used in conjunction with proper risk management. Always ensure that you have a thorough understanding of the indicator’s methodology and its limitations before making any investment decisions. Additionally, past performance is not indicative of future results.

29 Jul

Catatan Rilis

## Update V 1.01

- Added a indicator_linewidth parameter to uniformly adjust the line width across all plots.
- Updated the data source for Hash Ribbons, switching from QUANDL:BCHAIN/HRATE to INTOTHEBLOCK:BTC_HASHRATE for improved data reliability.

These updates enhance visual customization and the accuracy of Hash Ribbons indicators.