The indicator SOPR by Glassnode is used. The SMA is also used to smooth the values of the SOPR indicator.
For: - Only for BTC/USD or BTC/USDT - Time frame 1d or more
Lines: - Blue line is SMA of SOPR - Black line is always 1.00 - Red line is 1 plus user percentage - Lime line is 1 minus the user percentage
Background: - If the indicator is above the red line then the red background is displayed - If the indicator is below the lime line the lime background is displayed
Usage: - When the SMA of SOPR is above the red line there is a high probability of a market top. - When the SMA of SOPR is below the lime line, there is a high probability of a market bottom (these are good prices to buy bitcoin for a long-term position).