This is an alpha chart.


It tells us two very important things.
in the middle, in grey, we have the mean reversion index.
The Bitcoin Mean Reversion Index measures how far the current price of Bitcoin deviates from its historical moving averages.
Price spike up and down, but eventually always move back to the averages.
What we can see here is that the mean reversion index is already reverting back, in the exact same position it was during the lows of the previous bear cycles.
Its in an almost identical position to the low of 2022.
Secondly, at the bottom, we have the overextension and deep value graph.
We can see that in each cycle Bitcoin has made it into the very top level of this, representing Quantile 97+.
This time, it only reached 82.
So the reason Bitcoin has already begun mean reverting to the average, whilst on its lowest percentage bear cycle drop ever, is because it did not overextend in the same way.
The more something expands, the greater it will contract.
And this shows us that in actual data.
BTC-3.10%
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GateUser-ac9a452b
· 4h ago
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