When the S2F reversion metric reaches a value above 2.5, it often signals a good opportunity to secure some profits, making it a valuable tool for market timing.
On September 11th, the metric gave a buy signal with a value below 1 when Bitcoin reached $57K.
The next critical level to monitor is a value above 3, which typically indicates that the market is overheating.
A prudent strategy when using this indicator is to take moderate profits once the S2F reversion ratio hits 2.5 and to secure larger profits when the ratio exceeds 3, thereby balancing risk and reward effectively.
Written by Darkfost
