The Stablecoin Supply Ratio Oscillator is a technical indicator used to assess market sentiment regarding stablecoins relative to Bitcoin over time. It helps traders and analysts understand whether the market is leaning towards bullish or bearish conditions. The oscillator is calculated by taking the difference between the current Stablecoin Supply Ratio value and its 200-day Simple Moving Average (SMA), then dividing it by the standard deviation of the SSR over the same period. When the oscillator is above the upper Bollinger Band, it may indicate bearish sentiment, suggesting that stablecoin dominance over Bitcoin is relatively high, potentially signaling a downturn in the market. Conversely, when the oscillator is below the lower Bollinger Band, it may suggest bullish sentiment, indicating that stablecoin dominance is relatively low compared to historical trends, possibly signaling an upward trend in the market. This oscillator provides traders with valuable insights into shifts in market sentiment, allowing them to make informed trading decisions.
