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Author Topic: (GUIDE) ON-CHAIN DATA Indicators explained  (Read 66 times)
Mahmoud70 (OP)
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August 13, 2021, 07:47:41 PM
Last edit: August 13, 2021, 08:09:03 PM by Mahmoud70
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I made some research and I put here the stuff that I found interesting i hope you get a useful stuff here and if you got more info I wish if you share it with us
Note: i put under every indictor a link for it and all the indicators here you can get for free
 
                                                       ON-CHAIN DATA Indicators explained
Here you will find the best On-chain indicators  that you could really use in your trading decision
1-BTC: All Exchanges Reserve
The amount of BTC held in all exchanges' wallets. (The number increase means an increase in BTC supply for selling, altcoins purchasing, and margin trading.)



https://cryptoquant.com/overview/full/247?window=day

2-BTC: All Exchanges Netflow
The difference between the number of BTC flowing into and out of all exchanges' wallets. (If positive, inflow>outflow, an increase in BTC supply for selling, altcoins purchasing, and margin trading.)



https://cryptoquant.com/overview/full/474?window=day

3-Flow to fund

The total BTC amount flowing into or out of the exchange is divided by the total BTC amount transferred on the whole Bitcoin network.
Use cases: don't use it for ALL exchange charts, it's useless that way. you want to look at all the exchange charts alone so you can spot which one is doing something unnormal or have more volume than usual, when one exchange has a peak in its chart that means it has a move here, so you could look to its charts for reserve and net flow  and consider it as an in/outflow and look for a buy/sell  signal



https://cryptoquant.com/overview?search=fund+flow+ratio


4-BTC: Stock to Flow  
A valuation metric for bitcoin based on its scarcity. (The number increase means an increase in BTC's scarcity.)


https://cryptoquant.com/overview/full/467?window=day


5-BTC: All Exchanges Inflow Mean (144 MA) 5m chart
It's the average amount of bitcoin deposited into all exchanges. In the 144ma moving average chart, if this indicator goes over 2 BTC during the surge, Bitcoin whale dumping is likely to happen if it goes below 2 BTC immediately after the dip, which means victim whales are depositing to exchanges but not selling them.

https://cryptoquant.com/prochart/gVyAylaHNw1DwmY

6-BTC: Exchange Whale Ratio
The exchange Whale Ratio is the relative size of the top 10 inflow transactions to total inflows. In the bull market, it often keeps below 85%. On the other hand, in the bear market or fake bull for mass-dumping, it usually keeps above 85%.

https://cryptoquant.com/prochart/cTCCdBE1nEiGkQN

7-BTC: Miners' Position Index (MPI; 30-day MA)
It is all miners' outflow divided by its one-year moving average. If miners withdraw an unusually large amount of Bitcoins compared to the past year, the MPI increases, and the Bitcoin price is likely to be bearish. If you draw lines when MPI is higher than 2.5, it often matches local and global highs. On the other hand, if the MPI is low, miners hold Bitcoin, meaning it's likely to be bullish. They were HODLers in 2018 and 2020 great sell-offs though

https://cryptoquant.com/prochart/9wtDAZIRReVA6Ya

8-BTC: Coinbase Premium Index
It's the price difference between Coinbase's BTCUSD pair and Binance's BTCUSDT pair. The higher the premium means Coinbase whales accumulate Bitcoin despite the high price. 2020 bull-run was driven by institutional investors and high net-worth individuals in the U.S., and they're using Coinbase. When the Bitcoin price broke 20k, 30k, and 40k, the Coinbase premium was more than $50.

https://cryptoquant.com/prochart/xA0pdVXRdpk0zMk

9-BTC: All Exchanges Inflow Mean (7-day MA)
Whales tend to realize profits when retail investors are active in the market. This indicator is the 7-day moving average on the All Exchanges Inflow Mean. Bitcoin price is likely to go up when whales are active in the market in the long term. When this indicator goes below 1 BTC means retail investors are involved, and it's likely to be bearish.

https://cryptoquant.com/prochart/5QBFo5E8HKTNLCF

10-BTC: Fund Flow Ratio & Tokens Transferred
Tokens Transferred refers to the total amount of Bitcoin that has moved on the network. Fund Flow Ratio is the amount of Bitcoin used for deposits/withdrawals on the exchange divided by tokens transferred.
If the Tokens Transferred is high, and the Fund Flow Ratio is low, it might indicate OTC transactions are active. For example, when the Bitcoin price was ranging $10k in 2020, 4 million Bitcoin ($40B) moved on the network, where only 3% of the transactions took place on the exchange, and 97% of the transactions took place outside the exchanges. After that, many institutions announced that they had purchased Bitcoin, including Microstrategy, Ruffer, One River, etc.

https://cryptoquant.com/prochart/0j2x4hc2ay

11-All Stablecoins: All Exchanges Inflow Addresses Count
It's the number of deposit wallets in all types of stable coins flowing into all exchanges by block. If this indicator goes above 80, the price will likely be a short-term bullish like 1-5%. Since one ETH block interval is 10-15 seconds, it means 80 stable coins are deposited consecutively within 15 seconds. The signal would be more accurate if it hits 80 more than two to three times (should be used with other indicators )

https://cryptoquant.com/prochart/v0y0s61x7z

12-MVRV Ratio (Market Value to Realized Value)
By comparing two valuation methods, MVRV ratio can tell us to get a sense of whether the price is fair or not, which means it is useful to get market tops and bottoms. When this value is too high, BTC price may be overvalued, possibly implying selling pressure. On the other hand, when this value is too low, BTC price may be undervalued, possibly implying buying pressure.
We set the upper threshold as 3.7 and the lower threshold as 1 for spotting market tops and bottoms. If the sharp upward trend continues to grow above 3.7, we need to wait for the timing to sell our position off. Conversely, if the gradual downward trend has been shown and the trend goes sideways, it is time for taking a long position.

https://cryptoquant.com/overview/full/197?window=day

13-Estimated Leverage Ratio
ELR for a derivative exchange tells us how much leverage is used by users on average. This information measures traders' sentiment whether they take a high risk or low risk. If ELR value is high compared to the last couple of days, it indicates traders are quite confident in their positions. Funding data such as funding rates may help traders to build a robust trading strategy with this information. In addition, ELR can estimate the exchange's transparency indicating exchange risk itself

https://cryptoquant.com/overview/full/8529?window=day

14-Stablecoin Supply Ratio
Stablecoin Supply Ratio (SSR) is defined as a ratio of the Market Cap of BTC divided by the Market Cap of all Stablecoins.
Stablecoins play an important role in the cryptocurrency market as a fiat currency like USD in the regulated market. This is because fiat currencies like USD as a supplier of liquidity have a lot of regulation issues. Thus, more supply in stablecoin markets may indicate potential buying pressure for major cryptocurrencies like BTC. On the other hand, less supply in stablecoin markets may indicate the slowdown in buying pressure, which may result in potential bearish moments.
In SSR words, if lower the value is, meaning potential bullish sentiment, and if higher the value is, meaning potential bearish or sideways sentiment.

https://cryptoquant.com/overview/full/469?window=day

15-NVT Golden Cross
NVT Golden Cross (NVT_GC) is a Bollinger-band-like signaling indicator based on NVT, defined as the following equation.
NVT Golden Cross targets to generate short or long signals by comparing the short-term trend of NVT and the long-term trend of NVT. If the short-term trend is way greater than the long-term trend is, the network can be interpreted as overpriced and will soon revert to mean value, meaning short signal. Similarly, the opposite case may imply a long signal

. https://cryptoquant.com/overview/full/201?window=day

16-Stablecoin Exchange Reserve
The amount of the stable coins held in the exchange addresses.
Stablecoin Reserve Indicates Buy Power. Exchanges Stablecoin reserves collectively are a measure of potential to buy into the market

https://cryptoquant.com/overview/full/581?window=day

17-BTC: All Exchanges Short Liquidations USD (All Symbol)
Sum of forced market orders to exit leveraged short positions in USD quantity caused by price variability on all exchanges all trading pairs.

 https://cryptoquant.com/overview/full/12520?window=day

18-BTC: All Exchanges Long Liquidations USD (All Symbol)
Sum of forced market orders to exit leveraged long positions in USD quantity caused by price variability on all exchanges' all trading pairs.  

https://cryptoquant.com/overview/full/12515?window=day

19-Taker Buy Sell Volume/Ratio
When takers buy at the bid price set by makers, the amount of assets traded between the two contributes to the taker seller volume. This volume is selling volume because it has the potential to move the price down. When takers sell at the asking price, the amount of assets traded contributes to the taker buy volume. This volume pushes up the price.


20-SOPR
SOPR is an indicator which reflects the degree of realised profit and loss for all coins moved on-chain
he SOPR (Spent Output Profit Ratio) The SOPR (Spent Output Profit Ratio) indicator provides insight into macro market sentiment, profitability and losses taken over a particular time-frame.

The SOPR indicator can be considered within the following framework:
SOPR values greater than 1 imply that the coins moved that day are, on average, selling at a profit (price sold is greater than the price paid).
SOPR value less than 1 implies that the coins moved that day are, on average, selling at a loss (price sold is less than the price paid).
SOPR value of exactly 1 implies that the coins moved that day are, on average, selling coins at break even.
SOPR trending higher implies profits are being realized with potential for previously illiquid supply being returned to liquid circulation
SOPR trending lower implies losses are being realized and/or profitable coins are not being spent.
Indicator Signals
In general, higher the SOPR values indicate that the more profit was realised that day. Successive peaks of high SOPR (creating an indicator uptrend) suggest continual distribution, usually during a bullish price rallies. As more coins are spent back into liquid circulation, the probability of a local or macro market top increases.
Conversely, lower SOPR values indicate one, or both of the following scenarios:
Investors holding profitable coins have reduced their spending indicating a return of conviction and a belief that current prices are not expensive. In bull markets this can signal that a correction has exhausted sellers and that accumulation may be underway.
Investors holding coins at a loss are spending their coins. When the proportion of realised losses exceed realised profit, SOPR will fall below 1.0. This is generally indicative of panic selling, capitulation or bearish market conditions.



Example Applications
Bull Market Rallies
As prices rally in bull markets, a larger proportion of the coin supply will be in profit. Additionally, as the bull market carries on, the magnitude of profit held by long term holders will grow. As this volume of unrealised profit grows, so too does the incentive for investors to sell and realise gains, releasing previously illiquid supply back into liquid circulation.
A typical sequence and SOPR interpretation during bull market rallies is as follows:
SOPR Reset (A): Following a price correction where sentiment is low, smart money accumulators step in to buy the dip and demand begins to exceed supply. SOPR is low (near or below 1) indicating profitable coins are dormant and most spending was by panic sellers.
Distribution into Strength (B): As price rallies higher the incentive for profitable coins to realise gains increases, leading to distribution. SOPR increases, often in successive peaks as more and more supply is spent back into circulation at higher profit margins.
Local/Macro Top Established (C): Eventually, newly distributed supply overwhelms incoming demand and a local or macro market top is established. SOPR is usually high indicating large volumes of profit were realised.



Bull Market Corrections
In general, newer and inexperienced market participants are more likely to have 'bought the top' and subsequently panic sell their coins at a loss during corrections. Conversely, long term holders and experienced investors are more likely to own coins purchased at cheaper levels and be willing to deploy capital to buy the dip.
Following from the sequence above, typical SOPR interpretation during corrections is as follows:
Local/Macro Top Established (C): Distributed supply establishes a local or macro market top.
Price Correction (D): Profitable coins are distributed into the correction, however often at a slowing rate. Long term investors are less likely to panic sell profitable coins at the bottom, whilst newer investors are more likely to realise net losses throughout the correction. This drives the SOPR into a downtrend and to lower values.
SOPR Reset (A): Finally, capitulation by new investors results in low SOPR values (near or below 1), whilst profitable coins remain dormant, indicating conviction to hold and/or accumulate by smart money investors.

http://Bull Market Reversals
Bull markets eventually establish a macro top which is followed by an extended period of bearish considerations. The overall trend and peak levels of the SOPR indicator can provide insight into the relative magnitude of profit that has been realised, and then supply may be beginning to overwhelm demand.
A typical sequence for identifying macro bull market tops using the SOPR indicator is as follows:
Progressively Higher SOPR peaks around local tops and corrections indicates the magnitude of profit being realised is increasing with each rally. This also means that larger volumes of demand inflow capital is required to absorb coins sold at increasingly higher prices.
Sustained periods of High SOPR indicates that spending of profitable coins is not slowing down during price dips and thus may suggest a growing sentiment that coins are becoming expensive.
Significantly Low SOPR values during a price correction may indicate a wider market panic as investors realise large losses. Deep SOPR dips below 1 indicate a large portion of the market are underwater and may become overhead supply leading to bearish market conditions.


Bear Markets
In bearish markets, SOPR generally adheres to the same logic as bull markets, however in reverse. During bearish markets, general interest and demand for the asset wanes over time, and high volatility shake-out investors in both sell-offs and bear market rallies. Bear markets eventually establish a final price floor, where smart money buyers of last resort accumulate coins from holders capitulating at deep losses.
A typical sequence and SOPR interpretation during bear markets is as follows:
Macro Top (A): Macro market top is established as distributed supply eventually overwhelms demand. Both long and short term investors have distributed expensive coins at high realised profits leading to high SOPR values.
Local Capitulation (B): With the prevailing price trending lower, investors who are underwater capitulate and sell their coins at a loss during local lows. This leads to very low SOPR values, generally less than 1. These local capitulations also present opportunities for counter-trend traders to go long for bear market rallies.
Return to Profitability (C): When price rallies in a bear market, counter-trend traders or long term holders from the previous bull cycle return to profitability. As these coins are spent and sold, SOPR trends above 1 as profits are realised. As liquid supply from these spent coins again overwhelms the reduced bear market demand, market price may roll over, repeating phase B.
D, Sustained Capitulation: As the bear market reaches final capitulation, the maximum cross section of coin holders are at a net loss, and SOPR may persist below 1 for an extended period of time. This reflects a time where remaining profitable coins from the previous cycle are dormant, smart money begin accumulation and coins begin to move from a liquid to a relatively illiquid state, eventually creating a bullish supply squeeze.  

https://studio.glassnode.com/metrics?a=BTC&ema=0&m=indicators.Sopr&mAvg=7&mMedian=0&s=1511378227&u=1627516800&zoom=


21-NUPL (Net Unrealized Profit/Loss)
NUPL (Net Unrealized Profit/Loss) looks at the difference between Unrealized Profit and Unrealized Loss to determine whether the network as a whole is currently in a state of profit or loss.
https://www.lookintobitcoin.com/charts/relative-unrealized-profit--loss/

Indicator Overview
Profit and Loss metrics answer the question: if all units of a given currency were sold today, how much would investors stand to gain or lose?
By looking at the delta between the price when a UTXO was created vs. the current price of an asset, we can determine whether the specific coins in that UTXO are in a state of unrealized profit (price has increased) or loss (price has decreased). When looking at this across the entire network, we can see how much of the network is in profit, and how much is in loss.
NUPL (Net Unrealized Profit/Loss) specifically looks at the difference between Unrealized Profit and Unrealized Loss to determine whether the network as a whole is currently in a state of profit or loss.
Any value above zero indicates that the network is in a state of net profit, while values below zero indicate a state of net loss. In general, the further NUPL deviates from zero, the closer the market trends towards tops and bottoms. As such, NUPL can help investors identify when to take profit (blue) and when to re-enter (red)



22-Puell Multiple
The Puell Multiple is a ratio of daily coin issuance (in USD) and the 365 moving average of daily coin issuance providing an oscillator derived from miner profitability and income stress.
Indicator Overview
The Puell Multiple examines the fundamentals of mining profitability and the way they shape market cycles. It is calculated by taking a ratio of daily coin issuance (in USD) and the 365 moving average of daily coin issuance (in USD).
Interpretation of the Puell Multiple can generally be considered in the following framework:
High values indicate that current miner profitability if high compared to the yearly average. As such, the incentive for miners to liquidate their treasuries is high and greater sell pressure may be expected.
Low values indicate that current miner profitability is low compared to the yearly average. As such, income stress may become a factor, and some miners may need to start reducing hash-power by switching off rigs. This increases the hash-share of remaining miners who can then sell fewer coins to cover their operations, reducing their impact on liquid supply.
Halving events will drop the current coin issuance by 50% relative to the preceding year creating an immediate halving of the Puell Multiple also. The effect on miner profitability will thus be as per the point on low values above.https://www.lookintobitcoin.com/charts/puell-multiple/
[imghttps://drive.google.com/file/d/1acZ85N7dgL91RkDcyYjGF0wvQTK4GPwY/view?usp=sharing[/img]http://User Guide Miners are compulsory sellers in Proof-of-Work networks as a result of their necessary capital expenditure on mining hardware, logistics, facilities, and power consumption. Furthermore, profitable operation of mining facilities is a challenging business, requiring well considered capital allocation and investment decisions. This is a direct result of the protocol difficulty adjustment which maintains a deterministic coin issuance, such that approximately the same number of coins are mined irrespective of hash-power applied to the network. As a result, the mining industry is extremely competitive and operates on very slim profit margins.
Miner profitability can therefore be considered a useful input when attempting to estimate supply-side sell pressure. The Puell Ratio achieves this by comparing today's aggregate fiat denominated miner income, to the yearly average. A 365-day average is selected to reflect an expected baseline income congruent with a miner's long-term investment horizon and planning decisions.
Identifying Macro Tops  Miners are often net bullish and long the asset that is being mined. Many miners will therefore have treasury reserves of excess coins that are mined, but not necessary to sell to cover ongoing costs. During bullish markets, the incentive for new miners to start operations, and for existing miners to expand increases alongside the fiat value of their treasuries. This creates an opposing force and incentive for miners to liquidate some portion of their treasury reserves to maintain their share of network hash-power.
As the incentive to sell mined coins increases, larger capital inflows are also necessary to absorb this sell pressure. The Puell Multiple will be trending higher in these instances, particularly during periods of rapid upwards re-pricing that significantly outstrips the lagging yearly average.
Puell Multiple values greater than 4.0 have historically signalled macro market tops, although it has reached values between 6 and 10 in early Bitcoin cycles.  https://www.lookintobitcoin.com/charts/puell-multiple/


Identifying Macro Bottoms
During extended bear markets, mining profitably becomes increasingly difficult. As prices fall, the aggregate income similarly falls, despite ongoing mining costs remaining at elevated levels. The cost of mining is generally considered fixed within each difficulty adjustment window (14-days for Bitcoin) which itself is defined by the overall hash-power competition on the network.
Miners with stronger balance sheets and low operational costs will be capable of withstanding longer and deeper bear market conditions than those with higher operational overheads. As prices fall, miners will necessarily liquidate more of their income, and begin liquidating treasury reserves to cover their costs, exacerbating the bearish conditions.
At some stage, mining profitability will squeeze out miners who reach their break-even mining price, and result in that hardware being switched off to cut back power consumption. Miners in stronger financial positions, who remain active on the network, will subsequently gain in relative share of hash-power. These remaining miners will have a larger share of the income, mined for the same fixed costs, and therefore can liquidate fewer coins and begin building reserves.
At this time, the Puell Multiple will have reached low levels below 1.0 indicating that miners are likely experiencing income stress. Historically, significant macro bottoms have been established at Puell Multiples less than 0.5, indicating miner profitability is 50% below the yearly average.

https://www.lookintobitcoin.com/charts/puell-multiple/


23-MVRV-Z Score
The MVRV-Z Score compares market value and realized value to assess when an asset is overvalued or undervalued.
Indicator Overview
The MVRV-Z Score is used to assess when an asset is overvalued or undervalued relative to its "fair value", as underlined by the deviation between its market cap and realized cap.
When market value is significantly higher than realized value, it has historically indicated a market top (red zone), while the opposite has indicated market bottoms (green zone).


24-Crypto Fear & Greed Index
http://Why Measure Fear and Greed?
 
The crypto market behaviour is very emotional. People tend to get greedy when the market is rising which results in FOMO (Fear of missing out). Also, people often sell their coins in irrational reaction of seeing red numbers. With our Fear and Greed Index, we try to save you from your own emotional overreations. There are two simple assumptions:
Extreme fear can be a sign that investors are too worried. That could be a buying opportunity.
When Investors are getting too greedy, that means the market is due for a correction.
Therefore, we analyze the current sentiment of the Bitcoin market and crunch the numbers into a simple meter from 0 to 100. Zero means "Extreme Fear", while 100 means "Extreme Greed". See below for further information on our data sources.
Data Sources
We are gathering data from the five following sources. Each data point is valued the same as the day before in order to visualize a meaningful progress in sentiment change of the crypto market.
First of all, the current index is for bitcoin only (we offer separate indices for large alt coins soon), because a big part of it is the volatility of the coin price.
But let’s list all the different factors we’re including in the current index:
Volatility (25 %)
We’re measuring the current volatility and max. drawdowns of bitcoin and compare it with the corresponding average values of the last 30 days and 90 days. We argue that an unusual rise in volatility is a sign of a fearful market.
Market Momentum/Volume (25%)
Also, we’re measuring the current volume and market momentum (again in comparison with the last 30/90 day average values) and put those two values together. Generally, when we see high buying volumes in a positive market on a daily basis, we conclude that the market acts overly greedy / too bullish.
Social Media (15%)
While our reddit sentiment analysis is still not in the live index (we’re still experimenting some market-related key words in the text processing algorithm), our twitter analysis is running. There, we gather and count posts on various hashtags for each coin (publicly, we show only those for Bitcoin) and check how fast and how many interactions they receive in certain time frames). A unusual high interaction rate results in a grown public interest in the coin and in our eyes, corresponds to a greedy market behaviour.
Surveys (15%) currently paused  
Together with strawpoll.com (disclaimer: we own this site, too), quite a large public polling platform, we’re conducting weekly crypto polls and ask people how they see the market. Usually, we’re seeing 2,000 - 3,000 votes on each poll, so we do get a picture of the sentiment of a group of crypto investors. We don’t give those results too much attention, but it was quite useful in the beginning of our studies. You can see some recent results here.
Dominance (10%)
The dominance of a coin resembles the market cap share of the whole crypto market. Especially for Bitcoin, we think that a rise in Bitcoin dominance is caused by a fear of (and thus a reduction of) too speculative alt-coin investments, since Bitcoin is becoming more and more the safe haven of crypto. On the other side, when Bitcoin dominance shrinks, people are getting more greedy by investing in more risky alt-coins, dreaming of their chance in next big bull run. Anyhow, analyzing the dominance for a coin other than Bitcoin, you could argue the other way round, since more interest in an alt-coin may conclude a bullish/greedy behaviour for that specific coin.
Trends (10%)
 We pull Google Trends data for various Bitcoin related search queries and crunch those numbers, especially the change of search volumes as well as recommended other currently popular searches. For example, if you check Google Trends for "Bitcoin", you can’t get much information from the search volume. But currently, you can see that there is currently a +1,550% rise of the query „bitcoin price manipulation“ in the box of related search queries (as of 05/29/2018). This is clearly a sign of fear in the market, and we use that for our index.
https://www.bybt.com/pro/i/FearGreedIndex



25-Exchange BTC Long/Short Ratio


https://www.bybt.com/LongShortRatio


26- Dominance by Volume
This indicator shows the dominance of the crypto market divided by ETH-BTC and OTHERS this way you can see if the liquidity is going out of the market or transfered to other place

https://coinalyze.net/futures-data/global-charts/


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August 14, 2021, 01:48:58 AM
 #2

Viewbase has table and chart for exchange flows (in / out).
https://www.viewbase.com/coin/bitcoin
In last 30D, 151,759 BTC was moved from exchanges. It is a big number and if you knows data from Glassnode, you will see it is similar to the trend of holder accumulation. Since May, Bitcoin ownership has changed from short term to long term hodlers.

Quote
Bitcoin HODL waves for Middle-aged (3m-1y) and Old coins (1y-5y) show the other side of this equation.

Younger coins are held dormant and thus mature into older and older age brackets over time showing the conviction of $BTC holders is high.
https://twitter.com/glassnode/status/1425272897363320833
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August 16, 2021, 08:56:06 AM
 #3

thanks for sharing. I am currently looking for some indicators to know my investment. I think I should completely abandon my emotions and rely solely on data for trading.
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