Is the Crypto Market Cycle Over? Using Rainbow to Determine Bitcoin's Price Movements - Logrithmic regression bands

Introduction

Before starting, please note that this article is intended solely for educational purposes and should not be taken as financial advice. Investments in crypto and DeFi are highly volatile, and it's crucial to never invest more than you can afford to lose. Always perform your own research and build strong conviction before making any investment decisions.

At Dad’s DeFi Space, we believe that education is crucial for success in the crypto world.

Now, let's explore today's topic: Is the crypto market cycle over? And how can we use Rainbows to predict price movements in BITCOIN

Bitcoin and Ethereum Market Analysis

Many investors are concerned about whether the crypto bull market is coming to an end. Let’s analyze key indicators that help determine where we stand in the market cycle.

1. Bitcoin's Market Cycle Indicators

The Rainbow Price Chart

The Bitcoin Rainbow Chart is a historical market cycle indicator that categorizes Bitcoin’s price into different color-coded bands:

• Red Zone: Overheated market, signaling a cycle peak.

• Orange Zone: High risk, but still rising.

• Green/Blue Zone: Undervalued and in a buying zone.

Currently, (March 2025) Bitcoin has entered the buy zone again at around $87,000, suggesting a strong opportunity for long-term investors. Historically, market tops occur when Bitcoin is above the red band, which has not happened yet in this cycle.

The Pi Cycle Top Indicator

The Pi Cycle Top Indicator has historically been able to predict market peaks within three days of the actual top. It uses two key moving averages:

• 111-day moving average (orange line)

• 350-day moving average multiplied by 2 (green line)

For a market top signal, the orange line must cross above the green line. As of now, this crossover has not yet occurred, suggesting that the market cycle is still in progress.

2. Ethereum’s Weak Performance Against Bitcoin

Ethereum (ETH) has been underperforming against Bitcoin (BTC), reaching its lowest level in over a cycle. However, historical trends suggest that Ethereum eventually recovers due to strong institutional backing. Large ETH holders (whales) are unlikely to let Ethereum fade, making it a compelling long-term play despite current weakness.

3. DeFi Lending and Liquidity Positions

DeFi investors should also consider key support levels for their lending and liquidity positions. For instance, a recent DeFi lending position on Revert shows a wide range between 0.022 and 0.025, highlighting important resistance and support levels in the market. This is a key area for traders and liquidity providers to monitor.

Is the Market Cycle Over?

Based on these indicators:

• The Rainbow Chart suggests Bitcoin is still in a buy zone.

• The Pi Cycle Top indicator shows no confirmation of a cycle peak.

• Ethereum's underperformance is concerning but not a death sentence.

While we may be entering the final phase of the bull market, there is still room for growth before the actual peak. Timing the exact top is difficult, but these indicators suggest that we are not there yet.

DeFi Trading and Investment Strategies

1. Using Non-KYC Exchanges for Trading

For those looking to trade without extensive KYC requirements, WEEKS

Exchange offers a great option for spot and perpetual trading. It also provides copy trading functions and up to $20,000 in USDT rewards, making it a strong alternative for active traders.

2. Yield Farming & Liquidity Pool Management

Yield farming and liquidity provisioning remain lucrative strategies, especially in concentrated liquidity pools like Uniswap and Aerodrome Finance. Key considerations include:

• Monitoring correlation between asset pairs.

• Managing liquidity ranges to optimize fee collection.

• Adjusting positions based on market conditions.

Final Thoughts

The crypto market cycle is not over yet, but we are likely in the final phase. This means traders and investors should:

• Stay vigilant with risk management.

• Monitor key indicators like the Pi Cycle Top and Rainbow Chart.

• Prepare for volatility as the market moves towards its peak.

If you found this article valuable, consider supporting Dad’s DeFi Space , following us on X (@cryptzone1013), and checking out our YouTube channel.

💬 Got questions or need help? Drop a comment below or connect with the DeFi community. Happy farming! 🚀

About the Writer: Kevin: A teacher by profession and a father by choice, my true passion lies in unlocking the vast potential of cryptocurrencies and DeFi. My aim is to educate and inspire anyone eager to explore or understand the myriad opportunities within this dynamic space., and get closer to financial freedom

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DISCLAIMER: The information contained herein is for entertainment and  informational purposes only and not to be construed as financial, legal or tax advice. The content of this video is solely the opinions of the speaker who is not a licensed financial advisor or registered investment advisor. Trading cryptocurrencies and defi poses considerable risk of capital loss. The speaker does not guarantee any particular outcome. © 2024 DAD DEFI SPACE

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