Indicator Overview
The Crypto Strength Index analyzes data from the top 250 tokens in the cryptocurrency market to evaluate the overall trend. The result is a single metric that ranges from 0 to 1, with 0 indicating no trend strength and 1 representing full trend strength across the market.
An exponential moving average (EMA) is applied to smooth the metric, providing a clearer picture of the overall trend.
Beyond detecting trend direction, the indicator can also highlight overheated or oversold conditions, helping to identify areas of potential market reversals.
How To Use This Indicator
Traders can use this indicator to gauge the strength of the overall crypto market. A value closer to 1 suggests strong market momentum, while values near 0 indicate weak or non-existent trends. The EMA helps filter out short-term fluctuations, making it easier to track sustained trends.
Overbought or overheated conditions occur when the indicator consistently approaches 1, signaling potential reversals or pullbacks. Conversely, values near 0 may suggest oversold conditions and opportunities for market rebounds.
Created By
Alpha Extract in April 2024