When Should You Buy Bitcoin

A quantitative approach to identify Bitcoin buying opportunities using two independent valuation metrics.

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🎯 The Strategy

Bitcoin enters a Double Undervaluation Buy Zone when BOTH conditions are met:

1. Price < 200-Day DCA Cost - Current price is cheaper than the average cost of consistent buyers over the past 6-7 months
2. Price < Power Law Trend - Current price is below Bitcoin's long-term fundamental value based on network growth effects

Using two independent metrics reduces false signals and identifies stronger buying opportunities.

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📊 Website

When Should U Buy Bitcoin

Features

• Historical Charts - Visualize when Bitcoin has been in the buy zone
• Real-Time Check - Get current valuation status
• Future Price Forecast - Calculate predicted Bitcoin price on any future date
• Strategy Backtesting - Test different investment strategies with historical data
• Distance to Buy Zone - See how much Bitcoin needs to drop to enter the zone

Data Updates

• Historical data update workflow is currently manual trigger only (workflow_dispatch); cron schedule is intentionally commented out
• Real-time check fetches live price from Yahoo Finance
• Note: Yahoo Finance BTC-USD data may have 1-2 day delay and typically excludes weekends (even though Bitcoin trades 24/7). This is a limitation of the data source, not the tool.

Local DCA Service (Poetry)

• Start/restart backend on port 8000:

lsof -i :8000 | awk 'NR!=1 {print $2}' | xargs kill -9; poetry run uvicorn dca_service.main:app --reload

• Run DCA service tests with Poetry:

poetry run pytest dca_service/tests -v

Macro Risk Score (Quick Config)

The chart Macro Risk Score is a weighted blend of macro stress signals:

• Net Liquidity 90D change
• SOFR
• MOVE
• HY OAS

Default weights are defined in:

• src/whenshouldubuybitcoin/visualization.py -> MACRO_RISK_SCORE_WEIGHTS

Current defaults:

• net_liquidity_90d_change: 0.35
• sofr: 0.20
• move: 0.20
• hy_oas: 0.25

To quickly tune weights:

1. Edit MACRO_RISK_SCORE_WEIGHTS in visualization.py
2. Regenerate charts:

poetry run python main.py

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🎮 Strategy Backtesting

Test different Bitcoin investment strategies without risking real money. All calculations run entirely in your browser.

Available Strategies

1. Daily DCA

Invest the same amount every day. Simple and consistent.

2. Monthly DCA

Invest your full monthly budget on a specific day each month (1-28). More realistic for most investors.

3. AHR999 Historical Percentile

Dynamically adjust investment based on where current AHR999 ranks historically. Buy more when Bitcoin is cheaper.

Default Multipliers:

• Bottom 10% (EXTREME CHEAP): 5x daily investment
• 10-25% (Very Cheap): 2x daily investment
• 25-50% (Cheap): 1x daily investment
• 50-75% (Fair): 0x (no investment)
• 75-90% (Expensive): 0x (no investment)
• Top 10% (VERY EXPENSIVE): 0x (no investment)

Features:

• Fully customizable multipliers for each percentile tier
• Real-time display of daily investment amounts
• Unlimited budget mode option (ignore total budget constraints)
• Only available for historical backtests (requires AHR999 data)

Results

• Total invested, final BTC balance, portfolio value
• Total return (%) and annualized return (%)
• Interactive chart showing portfolio growth over time
• Detailed transaction history with AHR999 values

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🔬 Methodology

200-Day DCA Cost

DCA Cost = 200 / Σ(1/price_i)

Harmonic mean of the last 200 daily closing prices.

Power Law Trend Model

Trend = a × days^n

Fitted via linear regression on log-log transformed data. Models network effects (Metcalfe's Law) with decreasing growth rate over time.

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⚠️ Disclaimer

This tool is for educational purposes only. Do your own research before making investment decisions.