The economist and fund manager Dan Tapiero, who has more than 25 years of experience, shared his opinion on the best time to buy Bitcoin for a long-term retail investor who is willing to gain exposure to the digital asset market.
Tapiero offers investors a Puell Multiple indicator, which divides the daily coin issuance of BTC by the one-year moving average. The math behind the indicator is not the most important thing here, as the indicator's performance says it all.
The last 4 times, the Puell Multiple showed the correct point of each reversal on the market, including the $3000 BTC plunge in 2018 that would bring an enormous profit to anyone who made a purchase right at the bottom and then sold at the most recent ATH of $69,000.
The average investment horizon by using this indicator would be around 18 months, after which the indicator enters a "red zone" and Bitcoin hits a reversal. It is interesting to note that Multiple has also correctly shown local bottoms of each correction cycle, which means that it can even be used by midterm traders and investors.
What is happening to Bitcoin now?
A variety of different indicators are showing that the bottom is near, and that BTC will recover in upcoming months. Unfortunately, factors around the digital asset market show the opposite. While the aforementioned indicators have reached the bottoming zone, Bitcoin itself might remain in the consolidation range for a few more months.
In previous downtrends, Bitcoin was consolidating at the local bottom for a few weeks or even months before entering a new uptrend. This time, we might see the same result until the FED eases up on the monetary policy in the country.