Risk Wave, explained

Base average

374d

long mode (100d in short mode)

Time exponent

^0.395

stretches the gap as history grows

Blue zone

≤20%

risk score, near cycle floor

Red zone

≥80%

risk score, cycle-stretched

A 0–100 score built entirely from price. It measures how far an asset's price has drifted from its own long-run moving average — the average price across a set number of recent days — then stretches that distance by how much time it has had to build, and sets the result against the widest swings the asset has ever produced.

It runs on daily closing prices from CoinGecko. Nothing from the blockchain, no measure of market mood and nothing from the wider economy enters the calculation: everything the score knows, it knows from price.

Four steps, in order. First, a base moving average — the average price over the last 374 days by default ("long" mode; a 100-day average is available as a "short" mode). Second, the gap between price and that average, measured on a log scale — ln(price) − ln(baseMA) — so the same percentage move counts the same at any price level. The gap is positive when price sits above the average, negative when it sits below.

Third, a time scaler: (day count + 1) ^ 0.395, where the day count simply counts up from the first day of available price history and never resets. Multiplying the gap by this scaler produces raw risk — the same percentage distance from the average is worth more, in raw-risk terms, the later it happens.

Fourth, the 0–100 score. We track the highest and lowest raw risk the asset has ever recorded, then place today's raw value on that scale: (rawRisk − all-time low) / (all-time high − all-time low), held between 0 and 1 and turned into a percentage. Nothing is smoothed on top of it: the score you see is that value itself.

Because it never resets. Every day of price history adds one to the day count, and (day count + 1) ^ 0.395 goes up with it — slowly, since the power is well below 1, but permanently. Two points in history with an identical gap from the moving average will not produce the same raw risk value if one of them comes later; the later one is stretched further.

That is the point of the design: the same size of price stretch should register as more significant the longer the asset has been trading, rather than treating a 2013 Bitcoin slump and a 2024 one as directly comparable on distance alone.

A score at or below 20% marks the chart's blue zone — price close to, or beneath, its long-run trend once the time stretching is applied. A score at or above 80% marks the red zone — price stretched well above it. Nothing between 20 and 80 has a shaded zone or line of its own, though the live risk line still shades through five colours (deep blue, sky blue, amber, orange, red) with extra colour changes at 40 and 60 that this diagram leaves out.

The limits worth knowing are less about any single wrong call and more about how the score behaves over long stretches of time.

The moving average tells you how far price has wandered. The time scaler decides how much that wandering should count today.

Watch the gap between price and its moving average, not the raw price level. A widening gap above the average is what pushes the score toward the red zone; a shrinking gap, or price sitting under its average, is what pulls it toward the blue zone.

Long and short mode will not agree. They use different averaging windows in the same formula, so switching modes part-way will shift the reading — pick one mode and stay with it when comparing across dates.

You can run the chart on more than Bitcoin — individual coins, dominance measures (one coin's share of the whole market) and ratios are all on the list. Free accounts can pick between Bitcoin and Ethereum; the full list opens up on paid plans. Inside the Bitcoin and Ethereum Heatmeters, Risk Wave is worked out on each coin's own price history — the Ethereum reading is Ethereum's own, not Bitcoin's borrowed, the way some of that score's other blockchain-based ingredients are.

Risk Wave works from price alone — it says nothing about what holders paid for their coins, the economics of mining or the mood of the market, only where price sits against its own trend, stretched by time.

It carries real weight in both Heat Meters. In the Bitcoin score it is 10 of 100 points — mid-pack among the fourteen ingredients, behind AHR999 (13), RHODL (11) and Log Regression (11). In the Ethereum score it is 13 of 100, the largest single weight of any ingredient there. We adjust those weights as the indicators are re-tested.

Others in price & cycle models — What price is doing relative to its own history, trend and long-run models.

• Oscillator RiskHow today’s market conditions rank against every reading on record — 0 is the calmest, 100 the most stretched.
• BDZOur own measure of how far Bitcoin’s price has stretched from its recent average, in either direction.
• RSI Cross SignalA popular momentum gauge crossing its own average — a sign the direction is turning, not just that price has run hot.
• RSI HeatmapMomentum across many coins and short time windows at once, plus a 0-100 risk reading for whichever coin you pick.
• Fear & Greed IndexThe widely published 0–100 sentiment gauge, tracked alongside price so you can see when emotion led or lagged.

Every indicator we track — the full glossary.