On a few occasions last year, cryptocurrency advocates discussed how a number of price models, harnessed to help predict the future value of bitcoin, ended up failing. However, as bitcoin’s value has risen 36% over the past month, the price has entered the darker band of the rainbow chart after breaking below the lower band of the rainbow chart in late of 2022.
Bitcoin Rainbow Chart Is Circling Again
Last year, specifically in August 2022 and then at the end of the year, the cryptocurrency community discussed the various price charts and models that people used to predict where the bitcoin price was going next. Over the past decade, various models have followed bitcoin-specific price patterns quite closely. People often took advantage of charts and models such as the rainbow indicator, golden ratio multiplier, Fibonacci sequence, logarithmic growth curves, and Plan B’s stock-to-flow (S2F) pricing model.
As the community felt the grip of crypto winter and price models failed to forecast the bitcoin price floor, people began to dismiss bitcoin price models and dummy indicators like the rainbow graphic. But this week, people have I observe that the price of bitcoin in the rainbow model has entered the lower and darker band. The rainbow chart is found on a number of bitcoin-centric websites that display charts and data, including blockchaincenter.net Y buscabitcoin.com.
The chart from blockchaincenter.net shows that the bitcoin price has not broken the lower, darker band of the rainbow, but the chart from lookintobitcoin.com shows a breakout. Lookintobitcoin.com summarizes how the rainbow chart or color bands overlap. BTCchannel of the logarithmic growth curve of . It can signal when to buy and when to sell, but the website emphasizes that “there is no guarantee that past performance will conform to the rainbow channel and continue to develop in the future.”
Full #Bitcoin rainbow price chart indicator 🙂 pic.twitter.com/lIbUOd3bI4
— Cryptobeliever (@CryptoSportsIO) January 17, 2023
Crypto Twitter has been what is discussed Bitcoin’s grand entry back into the rainbow. “Rainbow Price Chart Reintegration”, Titan of Crypto tweeted. “After a dip below the ‘fire sale!’ blue band, (bitcoin) made it back to the rainbow. Did you dare to pick up something (bitcoin) when it was down? asked the individual. “The rainbow chart (of Bitcoin) is predicting the future… It has shown throughout Bitcoin’s history when to buy and sell. You have to study this to really feel comfortable with the long-term price of bitcoin,” another fan of the rainbow chart. wrote.
The redemption of the rainbow card is doing the rounds on social media, and some have He suggested entry is a bullish sign, while others have been skeptical. While the indicator shows BTCAs the price of has been rising, a correction could well be on the cards. Also, while the rainbow card is undamaged, the logarithmic growth curve graph It’s off the map, by far.
What do you think about the effectiveness of the bitcoin rainbow chart as a prediction tool? Leave your thoughts in the comments below.
image credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or a solicitation of an offer to buy or sell, or a recommendation or endorsement of any product, service or company. bitcoin.com does not provide investment, tax, legal or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.
