BTC price calculation that signaled the biggest Bitcoin bull run breaks out at $23K

by James · February 9, 2023

BTC price calculation that signaled the biggest Bitcoin bull run breaks out at K

A little-known Bitcoin (BTC) price gauge has just given another bull run signal – and it’s never been wrong.

As noted on February 8 by Caleb Franzen, senior market analyst at Cubic Analytics, the Williams %R Oscillator has left the bottom zone for the first time since May 2022.

Analyst: Oscillator crossover is a ‘great sign’

Bitcoin which surged 40% in January and continues to hold higher levels has given breakout signals across various on-chain indicators.

Some analysts are cautious and are choosing to wait and see if the improved conditions last, but for Franzen, the data coming from the Williams %R oscillator is of particular interest.

Williams %R is a momentum oscillator that measures how close BTC/USD is to recent highs or lows. Momentum oscillators are used to gauge the strength of a price trend, and Bitcoin’s performance in January has made it a prime test case.

“Bitcoin’s 12-Month Williams%R Oscillator Left ‘Oversold’ Threshold From January’s Monthly Close!” Franzen wrote in part in a dedicated Twitter thread.

“Historically, leaving the lower bound has signaled two things: 1. Cycle downturns are in. 2. Bear market is over.”

He added that the phenomenon was a “great sign”, while acknowledging that a bull run was not guaranteed.

An accompanying chart nevertheless showed the tight relationship between such Williams %R threshold crossings and subsequent long-term BTC price behavior.

The most recent came in April 2019, for example, where BTC/USD then began its journey out of bear market lows to finally reach all-time highs in November 2021.

A “reminder” meanwhile comes in the form of varying timeframes for the Williams %R. Franzen noted that only the 12-month iteration of the metric had turned bullish, while the 18-month version remained “oversold.”

“If/when this crosses > oversold, it will add to the bull case,” he added.

BTC/USD with Williams %R oscillator annotated chart. Source: Caleb Franzen/Twitter

Signs of Bitcoin rebirth are coming thick and fast

Franzen is far from alone in keeping the faith when it comes to the current BTC price action.

Related: Happy Bitcoin Anniversary, Tesla — Elon Musk Company Still Has 9.7K BTC

Over the weekend, popular trader Credible Crypto described the status quo as “identical” to Bitcoin’s breakout in late 2020, which saw it cross its previous all-time high from 2017.

Encouraging signs have also come from macroeconomic sources, particularly the US Federal Reserve, as well as internal phenomena such as the long-awaited “golden cross” event on the daily chart.

January, meanwhile, saw one renewed influx of institutional cash into Bitcoin, which took most of the resources as investors shied away from many altcoin products. Weekly inflows for the last week of the month were the highest in seven months.

The views, thoughts and opinions expressed herein are those of the authors alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.