What is the Bitcoin Rainbow Index? Along with the Bitcoin progress chart

Bitcoin digital currency is sold as the best and most valuable cryptocurrency in the digital currency market. Bitcoin always surprises its fans with new features it creates and launches. One of these features is the Bitcoin Rainbow Index. What is the Bitcoin Rainbow Index? Maybe this is a question that has arisen for you, dear readers, after mentioning the name of Bitcoin Rainbow Index. By knowing what  the Bitcoin Rainbow index is , people can invest in this digital currency better and more accurately. All of us are witnessing a significant drop in the price of Bitcoin these days, this digital currency is still in its upward trend and has made a great impact on the market. Therefore, if you are interested in investing in this digital currency,   do not miss the flagship article What is Bitcoin Rainbow .

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What is the Bitcoin Rainbow Index?

The Bitcoin Rainbow indicator is one of the features of Bitcoin digital currency that shows you the progress of this digital currency. Therefore, if you intend to invest in this digital currency at this time when its value has decreased, it is important to know this. This index includes a number of graphs that we will examine together. Digital currency training is a stage that every person must go through before entering the digital currency market, which is the subject of this article.

Bitcoin price chart

The Bitcoin price chart is one of the charts that shows the Bitcoin price trend for individuals from 2008 to today. This chart represents the ups and downs of Bitcoin digital currency. It is safe to say that all digital currencies in the market have not seen a significant upward trend like Bitcoin. This chart, sometimes called the Bitcoin logarithmic chart, shows you the exact and complete price of Bitcoin since its release. As you can see in the image below, its diagram is placed for you.

Bitcoin price growth

Bitcoin, which was produced for the first time in 2008 and publicly entered the market in 2009, has had an upward trend since the beginning. This digital currency was able to attract the attention of companies and organizations so much that it created the market of digital currencies that we use today. Most digital currencies were created to take the market from this cryptocurrency because they saw the popularity of this digital currency. Bitcoin, which has had a downward trend in the last few weeks and has reached the price of $60 to $30, has caused many changes in the market. This shows that holding and keeping this digital currency will have a great impact on its price increase.

What is the Bitcoin Rainbow Indicator Chart?

Now that you are somewhat familiar with the Bitcoin Rainbow index and have seen its logarithmic chart, it is better to go to the explanation of its index chart. The rainbow index chart, like the rainbow, has 7 colors, each of which represents a topic. In general, the Bitcoin Rainbow indicator chart shows the times of buying and selling Bitcoin. For example, as you can see in the picture, the lowest color is blue and the highest color is red. Blue and green colors indicate that a lot of bitcoins have been sold at this time, and orange and red colors are exactly the opposite. In general, in the places and dates when the price of Bitcoin has decreased, we have mostly seen its sale, and when its price has increased, we have seen the purchase of this digital currency.

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What is the application of the Bitcoin Rainbow indicator?

Now, how does knowing what the Bitcoin Rainbow indicator is help digital currency market participants? This indicator basically teaches investors when to buy Bitcoin and when to sell it. The orange areas are the best time to sell bitcoins. On the other hand, when it is in the blue and green parts, it is the best time to buy Bitcoin. Because the price is decreasing in the orange section and it has reached its lowest price in the green and blue sections, which is the best time to buy.

Another condition that can be obtained from the Bitcoin Rainbow index chart is its possible price in the coming years. For example, in 2013, buying Bitcoin at the price of $1,000 is in the red bar, but in 2017, it is in the blue part. This shows how accurate and predictable the dynamics and continuous growth of Bitcoin’s value is.

Halving Bitcoin

Another concept that can be extracted from the Bitcoin Rainbow index is the issue of Bitcoin halving. This process has happened several times since Bitcoin was created by a group called Satoshi Nakamoto. Bitcoin halving occurs when we have reached the limit of some Bitcoin mining. As you know, there are two ways to get Bitcoin, one through mining and the other through buying this digital currency. With each Bitcoin mining process, a new block is created in the Bitcoin blockchain, and if this number exceeds 21,000, halving occurs. With the occurrence of halving, Bitcoin tokens decrease or in other words become rare, and also the mining process becomes more difficult than before.

The first halving happened in 2012, and almost 12 months after this, the price of Bitcoin crossed the $1,000 mark. The second halving happened in 2016, and after a few months, the price of this digital currency exceeded $20,000. Therefore, it can be concluded that this situation will be true for the next halves as well, and knowing it will help you a lot.