The ‘Bitcoin Family’ has a special algorithm that tracks moon cycles — and it’s helped them gain 50% since the bear market bottom – UnlistedNews

LAGOS, PORTUGAL — In the small coastal town of Lagos, in the heart of Portugal’s southern Algarve region, Didi Taihuttu begins most days on the rooftop of her villa, an unassuming house with rustic charm perched high on of a hill rising from the Atlantic Ocean. The Mediterranean sun bounces off the bright white stucco walls of the house, illuminating the orange terracotta roof and casting a glow on Taihuttu, who sits on a plastic chair tucked under a round table of the same brand. The Dutch patriarch of the ‘Bitcoin Family’ drinks black coffee and pores over cryptocurrency price charts on his MacBook Pro as he decides which trades to start his day.

“We only need a few thousand a month to live, so our performance isn’t really important to us,” Taihuttu tells CNBC from his terrace overlooking a long stretch of cobalt water, cliff-lined beaches and bougainvillea.

Taihuttu’s modesty and unassuming background belies the 45-year-old’s success. In 2017, Taihuttu, along with his wife and three children, liquidated all of his assets and traded a 2,500-square-foot home and most of his worldly possessions for bitcoin and a life on the road. This was when the bitcoin price was around $900. Bitcoin is currently trading at over $30,000, down from an all-time high of nearly $70,000 in November 2021.

Those extreme price swings have helped grow the Dutch family’s crypto savings.

For seven years, the investor has been regularly exchanging his bitcoin for stablecoins pegged to the US dollar to capitalize on the volatility in the price of the world’s largest cryptocurrency. When Taihuttu thinks Bitcoin is hitting a bull market peak, he trades his Bitcoin for stablecoins like Tether, USDC, and DAI, and when it appears Bitcoin is hitting cycle lows during a bear market, he starts buying it again. So far, Taihuttu says the betting is working very well thanks to a market indicator he created called “Didi BAM BAM.”

The Taihuttu indicator considers a combination of inputs, including directional trade data and moon cycles. He has guided all of Taihuttu’s investment decisions since it was built before the pandemic.

“From mid-November to early December 2022, we saw the first signs that the bear market was completely over,” Taihuttu said. “It was confirmed in January 2023 when the long flag appeared in the model.”

He added: “People should have been buying bitcoins by now, because every bitcoin you bought at $16k, is now at $30k, so it’s almost 90% up.”

The father of three says his bitcoin investment is up 50% since the bottom of the most recent bear market.

The Taihuttus declined to share with CNBC the current dollar amount of their joint cryptocurrency investment, but Didi revealed that they had bought Bitcoin outright when the currency passed the $19,000 price threshold, so they “didn’t let them know.” It’s going so bad.” .”

It also helps that the nomadic family’s main domicile is in Portugal, Europe’s ultimate crypto tax haven.

“No capital gains tax or anything else is paid in Portugal on cryptocurrencies,” Taihuttu said. “As long as you don’t earn cryptocurrencies for providing services in Portugal, you’re free.”

“That’s a very beautiful bitcoin sky,” he said.

When Taihuttu began day trading tokens, it initially turned to traditional predictive metrics like the stock-to-flow model and the Mayer Multiple, a measure calculated by dividing the current bitcoin price by the 200-day moving average to help identify sparkling moments in the market when the value of an asset eclipses its intrinsic value.

But spending time reading the tea leaves of all these somewhat related measures didn’t seem like a particularly productive use of his time, so Taihuttu decided to create his own proprietary blend of the best indicators on the market.

“It’s not enough to know which indicators go into a formula,” Taihuttu explained. “What you can’t see is the calculation and the code that is implemented on top of the stock conditions. Those calculations are displayed in charts.”

So, starting in 2019, Taihuttu began incubating and refining a custom predictive trading tool that would weigh multiple technical indicators, plus a bit of astrology, and then return real-time insights into possible price changes.

“It is a combination of Bollinger Bands, Lower and Upper Bands, NMA, Red/Green Tape, NormStoch, RSI, Price Oscillator, Plot, MACD, Cross, Chande Momentum Oscillator, RSI-EMA, Full Moon and New Moon,” he explained. Taihuttu., naming a dozen of the most popular market signals that cryptocurrency traders look to when making investment decisions.

“Short and long signals and confirmation signals show up on charts when it could be a great time to buy or sell,” Taihuttu continued.

Here’s a quick breakdown of the technical aspects that underlie the model:

• Bollinger Bands Focus on price volatility over time. The model consists of a simple moving average line with two standard deviation lines known as upper and lower bands. Price movements outside of those outer bands can indicate if an asset is oversold, or vice versa.
• N-day moving average (NMA) It is a type of moving average that averages the closing price of an asset over a variable period of time, or “N” days.
• red/green tape the indicators represent bullish, or green, and bearish, or red market conditions.
• He Normalized Stochastic (NormStoch) look at the price momentum. He is a change in the stochastic oscillator, an indicator that compares the closing price of an asset to its price change over a designated period of time.
• Like Bollinger Bands, the Relative Strength Index (RSI) assesses whether an asset is oversold or overbought. Ranging from 0 to 100, the index measures the speed and scale of recent fluctuations in an asset’s price.
• Moving Average Convergence Divergence (MACD) compares two moving averages of the price of a cryptocurrency by subtracting the period from 26 exponential moving average (EMA) from the 12-period EMA.
• He Percentage Price Oscillator (PPO) You take the MACD reading and divide it by the 26-period EMA. It is possible to compare the PPO measures of different assets with larger price discrepancies, because it is expressed as a percentage.
• With bitcoin, when the line drawn by the 50-day moving average crosses above a rising 200-day moving average, it is read as a bullish indicator known as golden cross. When the 50-day moving average crosses below a lower 200-day moving average, it is known as the death crossthe signal of a bear market may be imminent.
• Chande momentum oscillator it is a technical momentum indicator similar to the relative strength index and the stochastic oscillator, except that it reacts faster to price changes.
• As its name indicates, the Relative Strength Index-Exponential Moving Average (RSI-EMA) combines both measures in a single indicator.

And then there are the intangible price influencers, like moon phases.

“I’m not saying it always affects the bitcoin price, but the moon has a lot to do with it,” Taihuttu said.

Taihuttu found that when there is a full or half moon, people tend to trade more.

“They tend to buy more, they tend to sell more,” he said. “Maybe it’s a coincidence, but if you look at the graph, you can see that mostly on a full moon, depending on where we are in the cycle, there’s either a dump or a bomb.”

Taihuttu added that moon phases are also often synchronized with the open and close of monthly bitcoin options and options.

“So if we’re at the top of the Bollinger Band in combination with the full moon, then you know we’re going to run,” Taihuttu continued, suggesting a market sell-off is imminent.

The technology grabbed the spotlight after the widespread public adoption of OpenAI GPT language processing technology. ChatGPT, which uses mass language models to create human-sounding responses to questions, has sparked an arms race among some companies over what is seen as the next “paradigm shift” in technology.

More recently, in May, Goldman spun off the first startup from the bank’s internal incubator: an AI-powered social media company for corporate use called Louise. The push toward AI is part of a larger effort by CEO David Solomon to accelerate the bank’s digital makeover.

Meanwhile, Morgan Stanley is using it to inform its financial advisers about any queries they may have. The bank has been testing an OpenAI-powered chatbot with 300 advisers so far, with an eye toward ultimately helping its roughly 16,000 advisers make use of Morgan Stanley’s repository of research and data, according to Jeff McMillan, head of research and bank details. company’s wealth management division.

Taihuttu uses ChatGPT, but more for writing articles on topics like bitcoin and Lightning Networks. But he points out that while it’s a productivity hack, the result doesn’t necessarily rank high in search results.

“They’ll still find out that it’s ChatGPT,” he says. “But it’s still saving you a lot of time.”

— CNBC’s Ryan Browne contributed to this report.