BTC Market Regime Prediction on Lower-Timeframe using Hidden-Markov Model

Introduction

ETFs market has been infamously known for it’s dynamic market-shift for traders, and this phenomenon has been going for more than a decade now.

This phenomenon creates a new challenge for traders who tries to reading the market before executing any trades. They need this basic yet important information:

What is the current market regime?

This question alone can be interpreted in so many ways, what is market regime in question? Is it the market volatility? Is it the bullish-bearish-neutral state? Even if those questions were answered, then the follow-up question would be:

How many regime are there?

And this is the beginning of this short-research using Hidden-Markov Model (HMM).