1、What Is the Bitcoin Rainbow Chart Indicator?
The Bitcoin Rainbow Chart is a long-term, logarithmic valuation model used to visualize Bitcoin's historical price movements and market sentiment over time. It overlays a rainbow-colored band across a logarithmic growth curve, with each color representing a specific sentiment zone—ranging from undervalued to overvalued conditions.
This chart is updated daily to reflect the latest BTC closing price
making it a useful macro indicator for investors and traders assessing Bitcoin’s potential buy or sell zones across market cycles.
Color Bands and Market Sentiment:
- Dark Blue – "Basically a Bargain Sale" → Indicates Bitcoin is severely undervalued.
- Blue – "Buy Now!" → Signals Bitcoin is clearly undervalued.
- Green – "Overweight" → Suggests the asset is still undervalued.
- Light Green – "Still Cheap" → Slightly undervalued, showing early bullish potential.
- Yellow – "HODL Zone" → Reflects a fair or reasonable valuation.
- Orange – "Is This a Bubble?" → Bitcoin may be entering overvalued territory.
- Light Red – "FOMO Zone" → Price is likely overextended, driven by hype.
- Red – "Sell Now!" → Strong signal of serious overvaluation.
- Deep Red – "Maximum Bubble Zone" → Indicates an extreme overvaluation, historically followed by sharp corrections.
2、How to View the Bitcoin Rainbow Chart on Coinglass
- Open your web browser and go to coinglass.com.
- On the homepage, navigate to the top menu and click on [Data].
- From the dropdown menu, select [Bitcoin Rainbow] to view the interactive chart.
