Indicator shows: Exchange purchasing power is gradually recovering The data of "chip concentration" cannot be used as a basis for direction judgment. Can it be used as a reference indicator to assist in direction judgment? Of course there is! For example, the "Exchange Purchasing Power Monitoring" indicator is one of them. Its usage is simple: waveforms above the zero axis (green) represent an increase in purchasing power, while waveforms below the zero axis (red) represent a decrease in purchasing power. As an on exchange liquidity provider with direct pricing power over BTC, the purchasing power of the exchange can be almost equivalent to price behavior. (Figure 1) For example, in Figure 1, the signal bar below, from blank to the appearance of the first blue signal, indicates the transition of the exchange's purchasing power from attenuation to recovery, that is, the change from 0 to 1. Often at this time, it is very likely to be the starting point of a trend reversal. But this is not 100% certain, it could just be a rebound. But in any case, as mentioned earlier, it can serve as a directional reference, meaning that when the signal "goes from presence to absence", the probability of going down is greater; And if the signal "starts from nothing", the probability of it going up is greater. (Figure 2) For example, when the 519 Black Swan event occurred in 2021, BTC had already dropped from a high of 6.3w to 3.7w; however, at this time, we saw the "Exchange Purchasing Power" signal showing "from yes to no", and continued to decline until the first blue signal appeared on July 20th and began to reverse. Since then, the signal has repeatedly experienced a situation of "starting from scratch", but due to the limited growth rate of the exchange's purchasing power in the later stage (the green waveform is not high enough), all of them only rebounded in the end. Summary: 1. At present, we have seen the emergence of the "first blue signal", indicating that purchasing power is beginning to recover to positive; But you have to ask me, is this a rebound signal or a reversal signal? I don't know. 2. We should understand this signal as follows: the first appearance does not mean an immediate reversal, but without a signal, there may not even be a rebound. 3. Any indicator of judgment is only "auxiliary", that is, it is not 100%, but rather the probability of which side is higher. 4. Can the truly critical green waveform continue to rise in the later stage; Every step, make sure to make it bigger. ---------------------------------------------- Bitget VIP， Lower rates and more generous benefits