Timing Usage of Technical Analysis in the Cryptocurrency Market

The cryptocurrency landscape underwent significant changes in 2024 with the regulatory approval of spot Bitcoin ETFs, opening the market to institutional investors and millions of new clients. As Bitcoin reached new price peaks, the market attracted many retail traders using speculative approaches, evidenced by the surge in meme coins at the end of 2024. In such an environment, properly examining trading strategies can offer substantial advantages over the majority of market participants. Many traders, however, fail to test their strategies adequately, limiting evaluations to selected time periods and risking overfitting. This paper introduces the Rolling Strategy–Hold Ratio (RSHR), which uses a rolling-window approach to evaluate how strategies would perform from thousands of different starting points. This method helps mitigate recency bias and provides a more comprehensive understanding of strategy performance across diverse market conditions and cycles. By comparing strategies results against buy-and-hold results, traders can make informed decisions about whether to refine their strategies further or opt for index-based investing or alternative analytical methods. This study demonstrates the RSHR’s applications across technical, on-chain, sentiment analysis, and dollar cost averaging strategies, with initial research suggesting potential applications in traditional markets.