Incredibly Useful On-chain Charts That Will Help You Time The Market

Hi, this is eth_whalehunter.

Want to get an unfair edge over the competition? Find out how to better time the markets with these cryptoquant charts.

Using on-chain analysis and TA, I sold most of my crypto in December and have been chilling in stables until recently.

If TA and analysis is just astrology for men for you, then it's best you skip this post. Most people I know that hodled and rountripped their portfolio got rekt last year.

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How to buy BTC at the Global Bottom

To know when the bottom is in, you need a signal that a capitulation event is happening/has happened. This is where the Bitcoin: Exchange Inflow (Mean, MA7) chart comes in handy. We will abbreviate it as EIMMA7 from now on.

Don’t worry if you don’t understand all the jargon. I will break it down for you.

You can access this chart for free on cryptoquant (here).

This cryptoquant chart allows you to look at the mean amount of BTC flowing into exchanges on a 7-day moving average (MA7) and the BTC price.

Mean is similar to the average, where it is the sum of all the given data values divided by the total number of data values given in the set. In this case, we look at the “average” amount of BTC sent to exchanges.

All exchanges: mean spot & derivative exchanges for which data is available on cryptoquant. Spot exchanges are exchanges where you can buy and sell Bitcoin and other cryptocurrencies. Derivative exchanges allow you to go long and short with leverage. Some exchanges like Binance allow you to do both. * 7-day moving average:* A moving average takes the past days of numbers, takes the average of those days, and plots it on the graph. For a 7-day moving average, it takes the last 7 days, adds them up, and divides it by 7.

Now that we have some of the terminologies out of the way let’s tackle the critical question, which is:

Why is this important? When capitulation events happen, or in other words, the market turns red, the EIMMA7 spikes up drastically as the mean amount of BTC goes up drastically. When the mean goes above 2BTC, it’s generally a good indicator that the market has hit a global bottom.

Why is this happening? * Whales are capitulating and thus sending a large amount of BTC to exchanges.

• Whales are sending BTC to derivative exchanges to cover underwater long positions.

• Whales are sending BTC to derivative exchanges as collateral for long positions.

Recipe for buying the dip at global bottoms:

1. Wait for the capitulation event: BTC drops -25%+
2. Bitcoin Exchange Inflow (Mean, MA7) > 2BTC
3. Check other on-chain metrics: MVRV, Puell Multiple. (check my post history).
4. Profit!

This is an extensive topic, and I'm just scratching the surface. Let me know if you have any questions. With on-chain analysis, i focus mostly on long-term investing. Ideally, you only want to do a few trades per year.

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