Market Amplitude in Crypto: The Metric that Tells You if the Rally is Real or Fake

We have all seen those days when Bitcoin goes up 3% but you feel uncomfortable because something doesn't add up. What you feel is the market breadth shouting something important to you: not everyone is making money.

What are we talking about?

Breadth measures how many cryptos are going up vs. how many are going down. It sounds simple, but it's powerful. Imagine 100 altcoins dropping while BTC takes all the bullish attention — that is a fragile market. In contrast, if 70 out of 100 coins are advancing, then the rally is real.

The calculation is straightforward:

Amplitude = (Coins up - Coins down) / Total coins traded

The 3 tools that matter

1. Advance-Decline Line (ADL) The most basic and useful. Adds those that go up, subtracts those that go down, and that's it. If the line is flat while the price is rising, red warning: reversal near.

2. McClellan Oscillator Turbocharged version of ADL. Adds moving averages to capture extreme conditions. When it hits the ceiling (overbought) or the floor (oversold), be prepared for a reversal.

3. Balance Volume (OBV) It not only counts coins, it weighs the volume. If many coins rise but with weak volume, the market does not really believe it.

How to use it in your trading

Confirm real trends: Sustained ADL rise + price rise = healthy trend. Divergence = trap.

Detect extremes: When indicators hit all-time highs, the reversal is near. It's counterintuitive but it works.

Validate your entry: Do you see a breakout in BTC? Check if ADL rises with it. If not, it's a fake out.

The reality

These tools do not predict, they only tell you if the market is convinced or doubting. Combine them with support/resistance and risk management. A single indicator has never made money; the synergy between multiple signals does.