Liquidity flows from altcoins to bitcoin and vice versa

Model appearance.

Model description

Crypto Drift is an indicator that tracks liquidity spillovers between bitcoin and altcoins. The idea is to analyze the behavior of bitcoin's market dominance relative to its price. When bitcoin's dominance increases, traders may exit altcoins in favor of BTC, and when dominance decreases, they may flow from BTC to altcoins.

The indicator uses two key market parameters:

1. Benchmark price.
2. Benchmark dominance.

The model readings can be interpreted as follows:

Negative values of Crypto Drift:

• This is a signal that BTC dominance is above its average relative to the price.
• Indicates an outflow of liquidity from altcoins to bitcoin.
• Potentially a bearish signal for altcoins.

Positive Crypto Drift:

• BTC dominance below its average relative to price.
• Indicates an inflow of liquidity from bitcoin to altcoins.
• Potentially bullish signal for altcoins.

Model Tests

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