When analyzing Bitcoin and Ethereum on a regular basis, I use Entity-Adjusted LTH-NUPL. This indicator is particularly accurate when analyzing Bitcoin, as it has never been wrong in historical data.
However, I had kept it under wraps because I had a question—if a major economic recession comes, will Bitcoin really drop into the "red alert zone" of this indicator? If it can truly drop in, this indicator would be my signal light for heavy buying.
When the red light turns on (entering the red zone), start dollar-cost averaging:
1. Buy when it breaks below the psychological price
2. Buy more as it falls
I can’t say that other indicators can signal a bottom. This indicator can only suggest opportunity areas, but it doesn’t guarantee the lowest price.
Even if a bottom-buying signal is triggered, purchases should be made in batches, not all at once.
All technical indicators must be combined with real-world economic news, such as Federal Reserve interest rate hikes, wars, pandemics, and other major events.