By Menno van Ravels - 13 years in crypto, 3 bear markets survived, zero paid promotions
Last reviewed:
5-step playbook
How to Use Risk Wave
To use Risk Wave, follow 5 steps: open risk wave and read the headline score, inspect the eight input breakdown, check the 30-day trajectory chart, and the remaining checkpoints below. Each step is self-contained, uses Alpha Factory data, and can be completed in under ten minutes once the workspace is open.
Reviewed · Alpha Factory Risk Wave
Open Risk Wave and read the headline score
Log in and open /risk-wave. The top card shows today's composite score (0-100) and regime zone. Before doing anything else, note which zone the market is in — every downstream decision depends on this single read.
Inspect the eight input breakdown
Below the headline score, each of the eight inputs is listed with its current normalized value, seven-day change, and contribution to the composite. Spend thirty seconds here — a score of 55 driven by high funding and low breadth is a different situation from a score of 55 driven by balanced inputs.
Check the 30-day trajectory chart
The trajectory panel shows the composite over the last 30 days alongside BTC price. Look for divergence: if the score is falling while price is flat, distribution is likely; if the score is rising while price is falling, accumulation is likely. These divergences precede most regime transitions.
Match exposure to the regime zone
Use the Risk Wave exposure ladder as a starting point — roughly 100% in Extreme Risk-Off, 80% in Risk-Off, 60% in Neutral, 40% in Risk-On, 20% in Extreme Risk-On — then adjust for personal risk tolerance. The exact numbers matter less than the discipline of matching sizing to regime.
Re-check daily, rebalance only on phase transitions
The composite updates daily. Intra-regime noise is not a rebalance signal. Only rebalance the portfolio when the score moves across a regime boundary (every 4-12 weeks historically), and even then do the move in two or three tranches rather than all at once.
Open Risk Wave
Risk Wave walks through the same steps interactively, pre-loads current Alpha Factory signals, and saves your configuration so the next session picks up exactly where you left off.
Open Risk WaveFrequently asked questions
What exactly does Risk Wave measure?
Risk Wave measures the current risk regime of the crypto market on a 0-to-100 scale, where low numbers mean risk-off (capitulation, fear, forward returns historically strong) and high numbers mean risk-on (euphoria, greed, forward returns historically weak). The composite combines eight independent inputs — BTC dominance, macro flow, ETH/BTC, Fear & Greed, stablecoin ratios, funding rates, realized volatility, and liquidations — so that no single signal can dominate the reading.
How often does the Risk Wave score update?
Once per day, after the 00:00 UTC daily candle closes. Intraday moves in individual inputs do not trigger a score update, because the composite is designed for allocation decisions that play out over weeks to months, not intraday trades. The dashboard shows the last update timestamp and the next scheduled refresh.
Is Risk Wave a buy or sell signal?
No. Risk Wave is a regime indicator, not a trade signal. The score tells members which regime the market is in so they can size positions appropriately — it does not say 'buy BTC at this price.' Members pair Risk Wave with Alpha Scan (which picks individual vehicles) and with personal entry/exit rules to turn the regime read into actual trades.
Which of the eight inputs matters most?
No single input dominates by design — that is the point of a composite. In practice, funding rates and stablecoin ratios tend to lead regime transitions at tops, while Fear & Greed and liquidations tend to lead at bottoms. Members who want more granularity can inspect the per-input breakdown on the Risk Wave dashboard and weight their own reading accordingly.
Has Risk Wave been backtested?
Yes, across two full crypto cycles (2018-2022 and 2022-present). The composite score printing below 30 has preceded 90-day forward BTC returns averaging roughly 3-5x the readings from scores above 70. Full backtest methodology and regime-by-regime decomposition is available to premium members inside the Risk Wave dashboard.
Do I need to understand all eight inputs to use Risk Wave?
No. The headline composite score and its regime zone are designed to be actionable on their own. The per-input breakdown is available for members who want to understand why the score is where it is — which is useful during ambiguous neutral regimes — but members who just read the headline score and size positions to the regime ladder capture most of the value.