Backtest Signals To Hedge Your HODL Strategy
Introducing signal backtests where we provide more detail on the “short-term holder realized price” metric and how it has helped signal momentum trends in the market over the last few years.
Relevant Past Articles:
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Introducing: Signal Backtests
Today, we are excited to present a new form of analysis to PRO subscribers. In the past, we have frequently mentioned and referred to various Bitcoin on-chain metrics that highlight the relative attractiveness of allocating to bitcoin at any one point in time. Now, we are introducing historical backtesting to accompany a certain metric, which will allow readers to evaluate the potential usefulness of such an indicator and determine if it’s something they wish to use when making their own financial decisions.
We understand that our audience consists of bitcoin HODLers, traders, speculators, investors and those who are simply curious about bitcoin as an investable asset. As such, we wanted to bring a new perspective to some of the data and insights we share with our readers in the form of allocation strategy backtests. Our backtest models incorporate 0.10% trading fees for buy/sells and are 100% risk on/off, meaning bitcoin allocation is either 100% or 0%.
IMPORTANT NOTE: This is not to encourage readers to sell all of their bitcoin or allocate 100% of their liquid portfolio to the asset, but merely to highlight the historical significance of this particular metric. Past performance does not indicate future results.
With that being said, let’s take a look at the short-term holder realized price and trends for bitcoin allocation using this metric…