Mayer Multiple: The Investor's Compass for Identifying Opportunities in Bitcoin

In the universe of cryptocurrency investment, especially when trading Bitcoin, timing is critical. The Mayer Multiple emerges as a powerful technical indicator, designed by renowned Bitcoin investor and analyst Trace Mayer, that allows investors to navigate between buying opportunities at market lows and bubble warnings at all-time highs. This indicator does not promise absolute certainty, but it offers invaluable insight for long-term decision-making.

What is the Mayer Multiple and how does it work?

The Mayer Multiple is an indicator that compares Bitcoin’s current price against its 200-day simple moving average (200-day SMA), providing a relative measure of whether Bitcoin is being undervalued or overvalued relative to its historical trend. Introduced by Trace Mayer in 2017, this tool makes it possible to distinguish between short-term “noise” and the actual direction of the market.

The elegance of the Mayer Multiple lies in its simplicity. The formula is straightforward:

Mayer Multiple = Current Bitcoin Price ÷ 200-Day Moving Average

Let’s take a practical example: if Bitcoin is trading at $82,000 and its 200-day SMA stands at $50,000, the Mayer Multiple would be 1.64. This number isn’t just a piece of data—it reflects that Bitcoin is being valued 64% above its long-term historical average.

Deciphering the levels of the Mayer Multiple

The true power of the Mayer Multiple lies in the interpretation of its ranges:

Below 1.0: Bitcoin is in “cheap” territory. Historically, these moments coincide with market panic and represent accumulation opportunities for long-term investors. The 200-day SMA acts as a psychological floor that the market tends to respect.

Between 1.0 and 2.4: It is the comfort zone of the market. Bitcoin trades at a reasonable price, reflecting a balance between supply and demand without extreme pressures. Most trading days (about 85% of historical time) the indicator stays in this range.

Above 2.4: The market enters warning territory. When the Mayer Multiple breaks above 2.4, especially if it reaches 3.0 or higher, it suggests that Bitcoin is in a potential speculative bubble phase. These levels often precede significant corrections.

Historical data through 2025 reveals that the Mayer Multiple has averaged 1.46 throughout Bitcoin’s history. The most extreme speculative spikes have reached levels of 3.8 or higher, particularly during December 2017 when Bitcoin touched $20,000.

Mayer Multiple Signals: Predicting Bitcoin Cycles

Identifying Market Funds

When the Mayer Multiple falls below 1.0, a green light is lit for contrarian investors. This level indicates that the market has reached a point of maximum bearish irrationality, where fear dominates.

The most notable case occurred in December 2018. Following the catastrophic drop from $20,000 in the previous cycle, Bitcoin collapsed to $3,200, bringing the Mayer Multiple to just 0.53—one of the lowest levels ever recorded. Investors who accumulated at the time experienced extraordinary returns as the market rallied in 2019-2021.

Detecting bubbles and peaks

Conversely, when the indicator shoots above 2.4, it’s time for watchfulness. The December 2017 event provides the most dramatic evidence: Bitcoin reached $20,000 while its 200-day SMA hovered around $5,200, generating a Mayer Multiple of 3.85. Months later, the market collapsed by more than 80%.

The pattern was repeated in November 2021, when Bitcoin hit $69,000 with a 200-day SMA near $22,000, resulting in a Mayer Multiple of 3.14. again, a violent correction followed, taking the price below $20,000 in 2022.

Mayer Multiple and Bitcoin’s halving cycles

Bitcoin experiences halving events—automatic reduction of the reward for mining blocks—approximately every 4 years. These events tend to catalyze broad price cycles. The Mayer Multiple behaves predictably during these cycles:

In the months following a halving, the price usually initially consolidates around or below the 200-day SMA, keeping the Mayer Multiple below 1.0. Then, as demand emerges and the bull cycle accelerates, the indicator gradually rises to 2.0 or higher, signaling the formation of the speculative bubble.

Following the May 2020 halving, the Mayer Multiple started at 0.9 and rose to 3.14 by November 2021, perfectly capturing the trajectory of the explosion cycle without the false positives that other indicators generate.

Practical application of the Mayer Multiple in your strategy

For investors looking to implement the Mayer Multiple effectively:

Adopt a long-term mindset: This indicator works best as a guide for buy and hold (hodl) strategies, not active trading. Short-term movements can contradict the indicator’s signals, generating unnecessary losses.

Combine with additional confirmation: The Mayer Multiple should work in tandem with RSI (Relative Strength Index), MACD (Moving Average Convergence-Divergence), and technical support/resistance levels. Use multiple confirmations before executing meaningful trades.

Check the history: Check out how the Mayer Multiple behaved in previous cycles. This educational exercise helps to gauge expectations and recognize patterns.

Current scenario (January 2026): With Bitcoin trading at around $82,000 and assuming a 200-day SMA around $50,000, the Mayer Multiple would stand at roughly 1.64. This level is comfortably in the neutral zone (1.0-2.4), indicating that Bitcoin is reasonably valued with no clear signs of bubble or maximum oversold. Investors can either wait for future developments or expect the indicator to reach more extreme levels (below 1.0 for buy or above 2.4 for take profits).

The limitations of the Mayer Multiple that you should know

Although powerful, the Mayer Multiple is not foolproof:

Inherent lag: The 200-day SMA is a lagging indicator by nature. You can’t anticipate disruptive events like regulatory changes, exchange hacks, or announcements by public figures that shake up the market instantly.

Inability to capture short-term volatility: Major news—such as Elon Musk’s statements on Bitcoin—can move the price violently in a day, but the 200-day SMA does not react immediately, leaving the Mayer Multiple lagging behind.

Specificity for Bitcoin: The indicator is optimized for Bitcoin and its 4-year cycle. It is much less effective with more volatile altcoins or with different cycle patterns.

Requires context: Not to be used in isolation. Novice investors who rely exclusively on the Mayer Multiple for decisions can suffer losses if they ignore fundamental analysis or changes in market dynamics.

Conclusion: Using the Mayer Multiple as a compass, not a map

The Mayer Multiple is positioned as one of the most reliable indicators for navigating the volatile world of Bitcoin. With clear signals—below 1.0 indicating bottoms, above 2.4 warning of bubbles—it has proven its worth across multiple market cycles from 2017 to today.

However, like any tool, its effectiveness depends on the user. The most successful investors employ the Mayer Multiple as part of a comprehensive strategy, combining it with technical analysis, fundamental considerations, and prudent risk management.

On the journey to identify the next bottom or avoid the next bubble, the Mayer Multiple is not a prophecy, but a directional compass. It keeps you oriented in the midst of the storm of price volatility. True mastery lies in knowing when to follow their cue and when to apply your own judgment. Are you ready to use it smartly?