Dear Readers,
This week, we analyze the odd certainty that we are currently feeling. Welcome back to another edition of Mean Median Mode—a quantitative risk report summarizing bitcoin price analysis and global macro narratives to position investors and bitcoin watchers with the data that matters. So, without further ado, here’s our latest risk report.
Performance Overview
Bitcoin: Technical Analysis
TBL Liquidity
Bitcoin: Correlation Analysis
Bitcoin On-Chain Analytics
US Rates Analysis
Fed Watch
Money Market Analysis
US Economy Analysis
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In this report, we found a new pattern within our TBL Liquidity metric: a quarterly liquidity cycle. This cycle recently peaked and is now on its way down to its next trough, which is why we believe the next month marks a decent opportunity to front-run the next liquidity cycle peak. For detailed charts and descriptions of this newfound framework, go to our TBL Liquidity section below.
In our previous report, the price hadn’t yet broken out, but now, two weeks later, it has. This breakout appears genuine rather than a “fake out,” as we saw a complete candle (representing three days of trading) close above resistance. Consequently, this resistance has flipped into support.
The RSI displayed significant divergence from its RSI-based Moving Average (MA). This indicates that price action might benefit from a pause or minor consolidation period to regroup before continuing its upward trajectory.
The Fibonacci Extension is a fixed target. We are developing a framework designed to provide guidance throughout the remainder of this cycle, which we’ll publish next week. We’ll regularly update this framework in each subsequent report.
As an initial guideline, we anticipate continued orderly price action similar to what we’ve observed over the past two years, provided the price remains below the BTC/GOLD Power Trendline. An orderly scenario would see the price reaching between $140,000 and $180,000, followed by consolidation phases with pullbacks around the 20% to 30% range.
On a lower time frame, the transition of resistance into support becomes clearer. For our Low Time Frame analysis, we use a 4-hour chart as the default setting. You can see the watermark indicating 240 minutes below the date, ensuring transparency in our chart settings. Ideally, we want this support to hold. It wouldn’t be catastrophic if we briefly lost it, as the 200-cloud should offer strong support around the $100,000 level, aligning neatly with this important level. However, we prefer not to see a 3-day candle close below this new support line at approximately $106,800.
Below the candle chart, you’ll notice three additional panes, all designed to help identify real-time demand and sentiment.
The first pane illustrates the percentage difference between USD and USDT on Coinbase. When the USDT price exceeds $1.00, it indicates trading at a premium, signaling demand. This measure closely correlates with bitcoin’s price movements—primarily in direction, though not always in magnitude.
We are actively exploring how stablecoin liquidity can enhance our toolkit for assessing overall demand and liquidity. Previously, in a TBL post, we demonstrated how the 30-day changes in stablecoin market capitalization correlate with bitcoin’s price action.
The indicator developed here for the lower time frame tracks differences in price, capturing the initial signs of demand. An increased demand for USDT pushes its price above the peg, prompting the issuance of additional USDT tokens to restore equilibrium. This issuance increases the circulating supply and consequently, the rise in market capitalization.
The second indicator illustrates the Coinbase bitcoin premium—the difference between bitcoin’s spot price on Coinbase and the broader ‘Index’ price—serving as a proxy for spot buying or selling activity on Coinbase.
The third indicator is the Binance Perpetual Premium, which measures the difference between the spot price and the perpetual swap price, effectively mirroring the funding rate. Currently, the spot price is above the perpetual swap price—a positive and healthy signal.
Many of you have been asking what the predictive power is for our TBL Liquidity proprietary; that is, how can we apply such a powerful model to our own investment strategies?
Well, for this report, we went back to the lab as we try to make our TBL Liquidity metric more useful. In doing so, we were able to detect an interesting pattern. It is worth noting here that today’s analysis is mainly observational and warrants a more thorough analysis.
That being said, we found a quarterly liquidity pattern within our metric. We have observed somewhat of a trigonometric function with relatively constant wavelengths when we take the 30-day nominal change of our metric.
In the chart above, we highlighted liquidity peaks over the past 3 years, and as you can see, the distance from peak to peak is approximately 90 days (or 3.05 months on average) for the most part.
Furthermore, we have also detected a liquidity peak corridor between a 30-day change of 2.5 and 5.5. That is, this newfound quarterly liquidity cycle tends to peak once our TBL Liquidity index has changed by 2.5 - 5.5 nominal points.
As the chart shows, on May 7th of this year, our cycle reached another peak and has been making its way down ever since.
Let’s now apply this discovery to risk assets to understand how we can use it as a buy or sell signal…
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