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Bitcoin’s price, like other datasets which span large ranges, is best viewed through a logarithmic
chart. A logarithmic chart scales based on orders of magnitude (where the y-axis represents
percentage change as opposed to fixed value change). This perspective better represents the
growth of the asset as we are interested in tracking percentage change as opposed to fixed
dollar change.
When viewed from this perspective (and displayed in the chart above), the volatility in Bitcoin’s
price becomes easier to anticipate and begins to form a more predictable long-term trend, with
identifiable over-exuberant “bubble” periods.
Hyperbolic growth curves on logarithmic charts also appear over large time frames in
traditional equities. While there are many examples available, we've highlighted a
traditional consumer product company (Johnson & Johnson) and a consumer
technology company (Apple, Inc.), both displaying exponential growth curves in linear
view (inset) and hyperbolic growth rates in logarithmic view.
Johnson & Johnson Monthly Line Chart, Logarithmic View, 1973 - Present
Charts: @100trillionUSD
Money Flow is an Early Indicator of Price
OBV is a technical indicator that operates on the notion that volume precedes price movement,
making it a leading indicator which we use to help us predict price. Rising OBV reflects increasing
buy volume pressure that may lead to higher prices, while falling OBV reflects increasing sell
volume pressure that may foreshadow lower prices.
2011 2015
2018
When analyzing OBV in relation to a long term down trend, we witnessed OBV continually set
lower lows ( ) through the bear market and capitulation. It is only after OBV begins setting
higher lows ( ) and breaks the long term OBV trend line ( ) while also (almost simultaneously)
breaking the long term downward price trend ( ) that we see the mark of the end of the bear
market.
Looking at 2018 and 2019, OBV appears to be setting higher lows and has broken both relevant
trend lines — likely signaling the end of the bear market.
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(the "General Partner”) believes to be reliable. The General Partner makes no representation as to the
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