A new Bitcoin market framework has just been released by Jamie Coutts, CMT, marking a significant step forward in understanding the cyclical nature of the cryptocurrency market.
After years of conceptual development and recent weeks of technical challenges, including LLM crashes and token constraints, Coutts has finalized the first version of his “Bitcoin Cycle Risk Framework.”
According to Coutts, the framework does not attempt to predict tops or bottoms in Bitcoin’s price. Instead, it aims to identify critical phases of risk across the cycle—whether risk is rising, receding, or reaching extremes.
The model incorporates key market variables such as liquidity, leverage, and behavioral patterns to offer a clearer picture of where BTC stands in its macro cycle.
“Bitcoin is cyclical,” Coutts emphasized, “and this model tracks why it moves.” The chart he shared combines three core indicators—GRS (Growth Risk Score), DRS (Drawdown Risk Score), and NPRS (Net Position Risk Score)—to provide a visual representation of market conditions over time. The historical overlay of Bitcoin’s price next to these risk indicators offers powerful context for interpreting potential shifts in sentiment and risk appetite.
While the model does not promise precise market timing, it is designed to offer a robust risk assessment tool for traders and analysts alike. Coutts notes that its strength lies in helping users understand when the market may be overextended or entering a period of heightened caution.
Kosta Gushterov
Reporter at Coindoo
Kosta has been a part of the team since 2021 and has solidified his position with a thirst for knowledge, incredible dedication to his work and a “detective-like” mindset. He not only covers a wide range of trending topics, he also creates reviews, PR articles and educational content. His work has also been referenced by other news outlets.
Source: https://coindoo.com/new-bitcoin-risk-model-aims-to-decode-market-cycles-through-liquidity-and-behavior/