Indicator Overview

The STH Realised Price Drawdown indicator measures the percentage deviation of the current market price from the algorithmically derived Short-Term Holder (STH) cost basis. Levels are displayed on a gradient from green (near 0% deviation, indicating price is close to the STH average acquisition cost) through yellow to deep red (extreme drawdowns beyond -80%), providing a clear visualisation of market corrections relative to recent speculative positioning. The price is overlaid on a secondary logarithmic axis, enabling direct comparison between absolute levels and relative deviations from STH-implied cost, contextualising cycle exhaustion, capitulation, and recovery potential.

Dual-Ticker Comparison Logic

The ‘Crypto’ fields allow the indicator to operate in both absolute and relative performance modes, supporting outright positioning or pair-based allocation analysis:

• Single Crypto Analysis: If Crypto 2 is left blank, the indicator measures Crypto 1 against US Dollars, highlighting periods where price trades far below or above the inferred STH cost anchor. This identifies potential capitulation zones, short-term accumulation opportunities, and stretched rallies relative to recent investor cost basis.

• Relative Strength and Ratios: When both fields are populated, the indicator calculates the ratio of Crypto 1 divided by Crypto 2 (e.g., ETH/BTC or SUI/SOL) and derives drawdown relative to the STH-implied cost basis of the ratio. This isolates relative performance independent of overall market movements, enabling detection of overperformance, underperformance, and regime shifts between assets.

How To Use

Deep red deviations often mark capitulation or prime accumulation points at cycle lows, while persistent green near 0% signals that price is trading near recent speculative entry points and may be overextended. Traders monitor rapid recoveries from large drawdowns as bullish confirmations or prolonged shallow drawdowns as warning signs of weakening momentum. Zero-line crossings indicate regime shifts: upward crosses suggest building strength relative to the STH cost basis, downward ones indicate increasing downside risk, supporting timing and risk management in multi-year market cycles.