Unless this indicator rises, all analyses are in vain, but the main question is what this indicator is, what it measures, and how we use it?
Indicator of "Cumulative Difference of Buy/Sell Amounts on Centralized Exchanges (CEX) for "altcoins" (excluding BTC and ETH)
What is its purpose?
It measures the cumulative difference between the volume of buy orders and the volume of sell orders for altcoins (all currencies except Bitcoin and Ethereum) on centralized exchanges (like Binance, Coinbase) over the course of one year.
How to read the chart:
⬇️Negative values (↓): Indicate dominance of selling pressure (volume of sell orders > volume of buy orders).
⬆️Positive values (↑): Indicate dominance of buying pressure (volume of buy orders > volume of sell orders).
Its relationship with Bitcoin price (orange line):
The chart shows the relationship between indicator movements and Bitcoin price fluctuations, aiding in analysis:
- Market reversal points.
- Correlation of altcoins with Bitcoin performance.
Why is it used?
Market liquidity analysis: large negative values may indicate periods of sharp declines ("Capitulation").
Direction Indicators: Repeated positive values may indicate the beginning of a strong upward movement for altcoins.
Checking trend strength: large differences support the continuity of the current trend.
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