Another Bitcoin U-Turn

Stats for Bitcoin's Overnight 20-day Low

Feb 03, 2025

IN TODAY’S REPORT

What we cover: STATS EDITION. Bitcoin stats when trades at a 20-day low and closes up on the same day.

TODAY’S STATS

Tariff Blues Reveal Demand

The imminent implementation of 25% tariffs on North American neighbors Canada and Mexico caused the crypto market to swoon overnight.

While alts took it harder than Bitcoin, the king crypto fell to a 20-day low before seeing aggressive demand drive it back to positive on the day.

While it’s not a given, I’ll assume a positive close tonight for the purposes of today’s report. As I write, successful U-turn looks likely, with Bitcoin poised to close up post-selloff.

`BITCOIN (BTC/USD). Bitcoin hits a >= 20-day low above 200ma and closes up same day.`

What does recent history tell us about what’s happening right now? Let’s dive in!

By defining its recent technical setup with three conditions and employing a 30-day holding time, we can see that this is a somewhat common occurrence. Note that I’ve eliminated an outlier from the early years: an over +300% gain. Everything else is shown below.

`BITCOIN (BTC/USD). Bitcoin Hypothetical Trades. Exclude early outlier gain.`

BITCOIN SETUP CONDITIONS 
CONDITION 1: Bitcoin trades at a >= 20-day low
CONDITION 2: Bitcoin closes above the prior day's close on the same day
CONDITION 3: Bitcoin closes > its 200ma

EXIT CONDITION
Sell 30 days later

OBSERVATIONS
*Even excluding the early outlier, the average trade using a 30-day hold sits at +26.14% 
*The Hit Rate is solid at 73.9% (percent profitable)
*The Average Gain (41.61%) is nearly twice the size of the Average Loss (-21.22%)
*This has been a consistently profitable setup, even with more muted gains in recent years

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As it often is, the overnight weakness has been revealing. Demand for Bitcoin continues to be strong around the $90k level for now. No change.

I’ve got a large dashboard of potential Bitcoin sell signal indicators, most of which remain far from signaling an exit. We may get more chop in the coming weeks, however. Beyond the chop? LFG.

Until next time…

peace_love_crypto

-DB

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