OPEN-SOURCE SCRIPT
Bitcoin MVRV Z-Score Indicator
### **What This Script Does (In Plain English)**
Imagine Bitcoin has a "fair price" based on what people *actually paid* for it (called the **Realized Value**). This script tells you if Bitcoin is currently **overpriced** or **underpriced** compared to that fair price, using math.
---
### **How It Works (Like a Car Dashboard)**
1. **The Speedometer (Z-Score Line)**
- The blue line (**Z-Score**) acts like a speedometer for Bitcoin’s price:
- **Above Red Line** → Bitcoin is "speeding" (overpriced).
- **Below Green Line** → Bitcoin is "parked" (underpriced).
2. **The Warning Lights (Colors)**
- **Red Background**: "Slow down!" – Bitcoin might be too expensive.
- **Green Background**: "Time to fuel up!" – Bitcoin might be a bargain.
3. **The Alarms (Alerts)**
- Your phone buzzes when:
- Green light turns on → "Buy opportunity!"
- Red light turns on → "Be careful – might be time to sell!"
---
### **Real-Life Example**
- **2021 Bitcoin Crash**:
- The red light turned on when Bitcoin hit $60,000+ (Z-Score >7).
- A few months later, Bitcoin crashed to $30,000.
- **2023 Rally**:
- The green light turned on when Bitcoin was around $20,000 (Z-Score <0.1).
- Bitcoin later rallied to $35,000.
---
### **How to Use It (3 Simple Steps)**
1. **Look at the Blue Line**:
- If it’s **rising toward the red zone**, Bitcoin is getting expensive.
- If it’s **falling toward the green zone**, Bitcoin is getting cheap.
2. **Check the Colors**:
- Trade carefully when the background is **red**.
- Look for buying chances when it’s **green**.
3. **Set Alerts**:
- Get notified when Bitcoin enters "cheap" or "expensive" zones.
---
### **Important Notes**
- **Not Magic**: This tool helps spot trends but isn’t perfect. Always combine it with other indicators.
- **Best for Bitcoin**: Works great for Bitcoin, not as well for altcoins.
- **Long-Term Focus**: Signals work best over months/years, not hours.
---
Think of it as a **thermometer for Bitcoin’s price fever** – it tells you when the market is "hot" or "cold." 🔥❄️
Imagine Bitcoin has a "fair price" based on what people *actually paid* for it (called the **Realized Value**). This script tells you if Bitcoin is currently **overpriced** or **underpriced** compared to that fair price, using math.
---
### **How It Works (Like a Car Dashboard)**
1. **The Speedometer (Z-Score Line)**
- The blue line (**Z-Score**) acts like a speedometer for Bitcoin’s price:
- **Above Red Line** → Bitcoin is "speeding" (overpriced).
- **Below Green Line** → Bitcoin is "parked" (underpriced).
2. **The Warning Lights (Colors)**
- **Red Background**: "Slow down!" – Bitcoin might be too expensive.
- **Green Background**: "Time to fuel up!" – Bitcoin might be a bargain.
3. **The Alarms (Alerts)**
- Your phone buzzes when:
- Green light turns on → "Buy opportunity!"
- Red light turns on → "Be careful – might be time to sell!"
---
### **Real-Life Example**
- **2021 Bitcoin Crash**:
- The red light turned on when Bitcoin hit $60,000+ (Z-Score >7).
- A few months later, Bitcoin crashed to $30,000.
- **2023 Rally**:
- The green light turned on when Bitcoin was around $20,000 (Z-Score <0.1).
- Bitcoin later rallied to $35,000.
---
### **How to Use It (3 Simple Steps)**
1. **Look at the Blue Line**:
- If it’s **rising toward the red zone**, Bitcoin is getting expensive.
- If it’s **falling toward the green zone**, Bitcoin is getting cheap.
2. **Check the Colors**:
- Trade carefully when the background is **red**.
- Look for buying chances when it’s **green**.
3. **Set Alerts**:
- Get notified when Bitcoin enters "cheap" or "expensive" zones.
---
### **Important Notes**
- **Not Magic**: This tool helps spot trends but isn’t perfect. Always combine it with other indicators.
- **Best for Bitcoin**: Works great for Bitcoin, not as well for altcoins.
- **Long-Term Focus**: Signals work best over months/years, not hours.
---
Think of it as a **thermometer for Bitcoin’s price fever** – it tells you when the market is "hot" or "cold." 🔥❄️
Skrip sumber terbuka
Dalam semangat sebenar TradingView, pencipta skrip ini telah menjadikannya sumber terbuka supaya pedagang dapat menilai dan mengesahkan kefungsiannya. Terima kasih kepada penulis! Walaupun anda boleh menggunakannya secara percuma, ingat bahawa menerbitkan semula kod ini adalah tertakluk kepada Peraturan Dalaman kami.
Penafian
Maklumat dan penerbitan adalah tidak dimaksudkan untuk menjadi, dan tidak membentuk, nasihat untuk kewangan, pelaburan, perdagangan dan jenis-jenis lain atau cadangan yang dibekalkan atau disahkan oleh TradingView. Baca dengan lebih lanjut di Terma Penggunaan.
Skrip sumber terbuka
Dalam semangat sebenar TradingView, pencipta skrip ini telah menjadikannya sumber terbuka supaya pedagang dapat menilai dan mengesahkan kefungsiannya. Terima kasih kepada penulis! Walaupun anda boleh menggunakannya secara percuma, ingat bahawa menerbitkan semula kod ini adalah tertakluk kepada Peraturan Dalaman kami.
Penafian
Maklumat dan penerbitan adalah tidak dimaksudkan untuk menjadi, dan tidak membentuk, nasihat untuk kewangan, pelaburan, perdagangan dan jenis-jenis lain atau cadangan yang dibekalkan atau disahkan oleh TradingView. Baca dengan lebih lanjut di Terma Penggunaan.