Indicator Overview

The Bitcoin Return Distribution is a statistical frequency matrix that visualises the volatility profile of Bitcoin by grouping historical daily returns into distinct percentage buckets. Rather than displaying price action chronologically, this tool reorders data into a probability density map, highlighting the mathematical frequency of specific market moves, from standard daily noise, to extreme "black swan" expansions.

The visual core of this tool is a Sigma-Weighted Histogram that identifies the asset's "fat tails". By calculating the Standard Deviation (σ) of all historical returns, the indicator distinguishes between expected market behaviour and statistical outliers. This allows traders to quantify the edge of holding an asset that historically produces aggressive positive outliers far more frequently than a standard normal distribution would suggest.