Buy Bitcoin in November?
Bitcoin Stats When Buying Nov 1st and Selling Jan 1st
IN TODAY’S REPORT
What we cover: STATS EDITION. Buying November, selling January. Average trade. Exclude outlier. Halving years only. Significance.
TODAY’S STATS
Late Year Edge or No Edge?
Stocks have a well-known historically bullish seasonal edge late in the year. But what about Bitcoin? That’s today’s focus as we look at a hypothetical November 1st buy and January 1st sell over Bitcoin’s history.
Let’s get to the stats!
BITCOIN (BTC/USD). Daily Chart with Today’s Query Conditions (Nov’23 - Jan’24).
To take a closer look at the future implications of the current setup, we need to run a simple test over all of Bitcoin’s reliable data starting 2011 to the present. Our “query conditions” represent a basic definition of the technical state of BTCUSD. The simpler the conditions the more data points we get to consider (three conditions is our typical max).
First, our simple query conditions:
BITCOIN SEASONAL QUERY
ENTRY AND EXIT CONDITIONS:
1. ENTRY CONDITION: Enter long ("buy") at the open of the November 1st candle
2. EXIT CONDITION: Exit ("sell") at the open of the January 1st candleBITCOIN (BTC/USD). Today’s Conditions: All Trades. 2011-Now.
The largest gain under current conditions occurred on January 1st, 2014 — the outlier of +249.28% — while the largest loss of -41.43% occurred on January 1st, 2019 following the crypto market wreckage of late 2018.
Notably, through 2017, this seasonal edge was on fire, with only a -4.28% loss on January 1st 2015, all other years being positive. But recent years have been far more challenging with losses on Jan 1st of 2019, 2020, 2022, and 2023.
In an adundance of caution, however, let’s throw out the 2013-2014 outlier from Bitcoin’s relatively early history and get a more realistic look at what we might expect going forward.
BITCOIN (BTC/USD). Today’s Conditions: Exclude the Outlier. 2011-Now.
Tossing out 2014’s outsized trade of +249.28% , the average trade drops from +40.4% to +23.0% using the same two-month hold. A still-respectable average gain, all things considered.
But what about Halving years? 2024 is just such a year, of course.
If we look solely at Halving years (2012, 2016, 2020, 2024), here are the returns:
Buy November 1st 2012 - Sell January 1st 2013: +20.84%
Buy November 1st 2016 - Sell January 1st 2017: +39.13%
Buy November 1st 2020 - Sell January 1st 2018: +109.98%
Buy November 1st 2024 - Sell January 1st 2025: TBD
Bitcoin is simply too young for statistically significant seasonal results. That said, the Halving year results are compelling.
Until next time…
peace_love_crypto-DB
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