First In History: Bitcoin Mayer Multiple Records Lower Value Than Last Cycle’s Low

The Bitcoin Mayer Multiple has recently sunk to a lower value than the bottom of the previous cycle. This is the first time in the history of the metric that such a trend has formed.

Current Bitcoin Cycle’s Mayer Multiple Low Is Deeper Than Last Cycle’s

As per data released from the analytics firm Glassnode, the current value of the BTC Mayer Multiple is around 0.478.

Before seeing what the Bitcoin Mayer Multiple does, it’s best to look at a basic explanation of a “moving average” first.

A moving average (or MA in short) is an analytical tool that averages out the value of any quantity over a specific period of time.

As its name implies, it moves forward along with the quantity, and changes its value accordingly. An MA can be taken over any timespan, whether that be 100 days, 72 hours, or even10 seconds.

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The bigger MAs are usually quite useful for long-term analysis as they smooth out any irrelevant short-term fluctuations.

One popular moving average for Bitcoin is the 200-day MA, which has historically indicated a bear market whenever the price has went below it, and a bull market whenever the price has crossed over it.

Now, what the Mayer Multiple does is measure how much the price of the crypto has deviated from this 200-day MA.

The below chart shows the trend in the metric over the course of the history of Bitcoin:

The value of the metric seems to have been below 0.5 in recent weeks | Source: Glassnode

In the graph, the blue line is for the Bitcoin 200-day MA and the green curve represents the points where the Mayer Multiple would have a value of 0.5.

As is apparent from the chart, the price of the crypto has sunk below this 0.5 Mayer Multiple line only a few times in the past.

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In fact, out of the total 4163 trading days for the cryptocurrency so far, only 87 have been spent below the green line, which comes out to be about only 2%.

A pattern that the Mayer Multiple followed before this cycle was that all successive cycles observed higher bottoms than the low of the previous one.

In the cycle so far, the metric has already dipped to 0.478, which is less than last cycle’s bottom of about 0.511. This is a first occurrence in the history of Bitcoin.

BTC Price

At the time of writing, Bitcoin’s price floats around $21.2k, up 3% in the past week.

Looks like the value of the crypto has moved sideways recently | Source: BTCUSD on TradingView
Featured image from Maxim Hopman on Unsplash.com, charts from TradingView.com, Glassnode.com