Bitcoin bubble index

[tranthidung]

This Bitcoin bubble index can be a good extra tool for you to watch the Bitcoin market and be alerted of time when people are starting and probably most FOMO in this market.

It can not tell you when Bitcoin hits its all time high or a peak of bull run but can signal you about time to seriously consider of market exit.

It is from Coinglass.

• https://www.coinglass.com/pro/i/bitcoinBubble
• Coinglass provides some charts but I like two charts for Bubble Index and Google trend
• You can visit Google to get data for Bitcoin-searched Google trend: https://trends.google.com/trends/explore?date=all&q=bitcoin&hl=en

We are like warming up but still calm before a storm too all time high.

Note:

• It was posted first in that topic, on Bitcointalk
• I leave the source link to avoid plagiarism accusation.
• I excluded/ included minor things from an original thread ^{if necessary}.

[Husires]

I do not see any interaction with the price of Bitcoin. When the index points were above zero, the price rose, but several weeks ago the points were below zero, and yet the price rose. The index was almost identical to the price until last May, when the difference between them began, perhaps because some believe that the current price is much lower than the fair price of Bitcoin, or that the bet was that the ETF would be rejected.

[notblox1]

This is interesting index I didnt see before, but I think it would be better to use more than one source of information to know when to exit or enter Bitcoin market.
Maybe combining and monitoring this with S2F Stock-to-Flow chart would give much more accurate predictions.
Right now we are way below bubble signal.

[trendcoin]

I saw this index for the first time and I liked it a lot. Anyway, I like to follow some index like this one. Of course, I don't always stick to them, but I like to keep an eye on them... Bubble happens in the price of everything. Some things are sometimes over-demanded and therefore over-priced. Bitcoin has experienced this in the past. We all witnessed it when it went from $20,000 to $3,000. Today, I think we are not yet in a bubble, so I can say that I have views in line with the index data.

[tranthidung]

I do not see any interaction with the price of Bitcoin. When the index points were above zero, the price rose, but several weeks ago the points were below zero, and yet the price rose.

There are lags as I see and the bottom line is not to use this Bitcoin bubble index or any indicator to find exact predictive signal for what will happen in future.

Even the lag is like days or weeks, it will still be good if it gives you signal about market top, peak and you still have enough time to exit the market because Distribution phase lasts long enough.

In previous market cycles, there are bounces after big corrections from ATHs and if you missed the ATHs, you could exit at the second tops which are only a little lower than ATHs.

This is interesting index I didnt see before, but I think it would be better to use more than one source of information to know when to exit or enter Bitcoin market.
Maybe combining and monitoring this with S2F Stock-to-Flow chart would give much more accurate predictions.
Right now we are way below bubble signal.

It is a supportive index. You can combine it with other indicators like Monthly RSI.

Generally, don't find absolute bottoms or tops, just find ranges of bottom and top, then schedule your time to enter or exit the market.
https://charts.bitbo.io/monthly-rsi/
https://charts.bitbo.io/macd/

I saw this index for the first time and I liked it a lot. Anyway, I like to follow some index like this one. Of course, I don't always stick to them, but I like to keep an eye on them... Bubble happens in the price of everything. Some things are sometimes over-demanded and therefore over-priced.

I agree with. Sometimes we just want to find too many details, focus too much on accuracy but ignore a fact that no one can predict the market correctly.

Seeing an overview of what's going on the market, on-chain and most important, knowing about previous cycles, fractals can help us a lot and even more than technical indicators.

We even don't need technical indicators and can use Google Trend to guess market tops. When the trend is up a lot, even not yet break Google Trend ATH, it is signal of top range.

[joniboini]

This tool seems to be based on this GitHub project[1]. I'm unsure how they calculate the index since there is a constant number that is not explained in the formula[2]. Based on the code, they seem to use this constant, the number of active addresses, Google trend search, etc to generate the number. Maybe anyone can shed light on how this formula came to be? Since it sounds like the variables are jumbled together.

[1] https://github.com/aksnzhy/bitcoin-bubble-index/
[2] https://github.com/aksnzhy/bitcoin-bubble-index/blob/master/original_data/process_data.py

[Yamane_Keto]

Maybe combining and monitoring this with S2F Stock-to-Flow chart would give much more accurate predictions.
Right now we are way below bubble signal.

It has been proven that the S2F Stock-to-Flow chart was broken from 2021, as the price was unable to break the upward trend above $100,000. Also, the Stock-to-Flow was giving greater value to the dates at the beginning of Bitcoin prices compared to the current prices, and it is natural for them to grow. Bitcoin is 100% easy compared to what will happen now and what will happen in the future.

This tool seems to be based on this GitHub project[1]. I'm unsure how they calculate the index since there is a constant number that is not explained in the formula[2]. Based on the code, they seem to use this constant, the number of active addresses, Google trend search, etc to generate the number. Maybe anyone can shed light on how this formula came to be? Since it sounds like the variables are jumbled together.

[1] https://github.com/aksnzhy/bitcoin-bubble-index/
[2] https://github.com/aksnzhy/bitcoin-bubble-index/blob/master/original_data/process_data.py

A bubble in the economy occurs when an asset grows rapidly and the price explodes quickly. It is closer to what happens in four-year cycles. At the beginning of the cycle, the bubble is small, and at the end it rises strongly. Therefore, certain words are used and searched in search engines to indicate that the bubble is growing.
This indicator is not accurate, but it is good for following historical details of the price.