When to Take Profits in Crypto: 7 Signals You Shouldn't Ignore

Data-driven indicators that help you sell into strength instead of holding into disaster

The hardest part of crypto investing is not buying. It is knowing when to sell. Most investors have no trouble clicking the buy button when they see a promising opportunity, but when their portfolio is up 200% or 500%, a paralyzing mix of greed and hope takes over. What if it goes higher? What if I sell too early? These questions keep people frozen until the market reverses and their gains evaporate. The solution is not guessing. It is watching the signals.

Markets do not top out randomly. Before every major crash in crypto history, a specific set of warning signals appeared weeks or even days in advance. The problem is that most retail investors either do not know what to look for or are too caught up in the euphoria to pay attention. This guide covers seven concrete, measurable signals that historically precede significant crypto market tops. When multiple signals flash at the same time, it is time to start taking profits, not time to buy more.

What You'll Need

• A free TradingView account for chart analysis and indicator monitoring
• Access to on-chain data platforms like Glassnode, CryptoQuant, or Santiment (free tiers available)
• A basic understanding of technical analysis concepts like RSI and volume
• An established portfolio with gains you want to protect

Step-by-Step Guide

Step 1

Signal 1: RSI Enters Extreme Overbought Territory

The Relative Strength Index, or RSI, is a momentum oscillator that ranges from 0 to 100. An RSI above 70 on the daily chart is considered overbought, but in crypto bull markets the RSI frequently stays above 70 for extended periods. The real danger zone is when the weekly RSI pushes above 85 to 90, a level that has historically marked major cycle tops. Bitcoin weekly RSI hit 89 in April 2021 before the crash to $30,000, and it reached 92 in November 2021 before the collapse to $15,500.

Open TradingView, pull up the BTC/USD weekly chart, and add the RSI indicator with the standard 14-period setting. When the weekly RSI climbs above 80, shift into caution mode and begin tightening your profit-taking plan. When it crosses 85, start actively selling tranches. Critically, watch for bearish RSI divergence on the daily chart, where the price makes a higher high but the RSI makes a lower high. This divergence has preceded nearly every significant Bitcoin correction in the past five years and is one of the most reliable warning signals in all of technical analysis.

Step 2

Signal 2: The Fear & Greed Index Stays Above 90

The Crypto Fear and Greed Index, available at alternative.me, aggregates volatility, market momentum, social media sentiment, surveys, Bitcoin dominance, and Google Trends into a single score from 0 (extreme fear) to 100 (extreme greed). Readings above 75 indicate greed. Readings above 90 indicate extreme greed, a condition that has historically only lasted a few days to a couple of weeks before a significant correction occurs.

During the November 2021 top, the Fear and Greed Index spent six consecutive days above 80 and hit 84 just days before Bitcoin began its descent from $69,000. In previous cycles, peaks in the index consistently aligned with local or cycle tops within a narrow window. When this index stays above 90 for more than two or three days, the market is priced for perfection and any negative catalyst can trigger aggressive selling. This is not a signal to panic sell everything, but it is a clear signal to accelerate your DCA-out plan and stop making new purchases.

Step 3

Signal 3: Parabolic Price Action Detaches from Moving Averages

In a healthy uptrend, the price stays relatively close to its key moving averages, periodically pulling back to the 20-day or 50-day moving average before continuing higher. When the price goes parabolic, it detaches significantly from these averages, creating what traders call an air gap. This gap always closes eventually, either through a consolidation or a sharp correction. The further the price extends above its 200-day moving average, the more violent the snapback tends to be.

On TradingView, overlay the 20-day, 50-day, and 200-day simple moving averages on the Bitcoin daily chart. Calculate the percentage distance between the current price and the 200-day SMA. When Bitcoin trades 80% to 100% or more above its 200-day moving average, it is in extreme overextension territory. In December 2017, Bitcoin was trading 135% above its 200-day MA just before the crash. In April 2021, it was about 95% above. When you see the price accelerating away from its moving averages in a steep, near-vertical curve, this is the market entering blow-off top territory and a powerful signal to take profits aggressively.

Step 4

Signal 4: Exchange Inflows Spike Sharply

Exchange inflows measure the amount of Bitcoin or other crypto being transferred from private wallets to exchange wallets. When large holders, often called whales, move significant amounts of crypto to exchanges, it usually means they intend to sell. A sudden spike in exchange inflows, especially when combined with rising prices, is a strong warning signal that smart money is distributing their holdings to retail buyers.

Monitor exchange inflow data on platforms like CryptoQuant or Glassnode. CryptoQuant provides a free Exchange Inflow metric and an Exchange Whale Ratio that tracks the proportion of large deposits relative to total inflows. When the Exchange Whale Ratio rises above 0.85 on a 7-day moving average during a strong rally, it historically signals that whales are selling into the strength. During the week before Bitcoin peaked at $69,000 in November 2021, CryptoQuant exchange inflows surged to their highest level in months. Retail was buying the hype while institutions and whales were depositing to sell.

Step 5

Signal 5: Volume Declines While the Price Continues Rising

One of the most fundamental principles in technical analysis is that healthy price moves are confirmed by volume. When Bitcoin is rallying and each new push higher comes with strong and increasing trading volume, the trend has genuine buying support behind it. But when the price keeps making new highs while volume steadily declines, it creates a volume divergence that signals the rally is running out of buyers. The remaining upside is being driven by fewer and fewer participants, which makes the move fragile.

Check the volume bars on any major exchange chart or use the aggregate volume indicators on TradingView. Compare the volume on recent highs to the volume on previous highs in the same rally. If Bitcoin breaks to a new all-time high on 40% less volume than its previous all-time high breakout, that is a significant red flag. The November 2021 Bitcoin top at $69,000 came on noticeably lower volume than the April 2021 high at $64,000. This declining volume pattern was visible on both spot and futures markets and was one of the clearest warnings that the second leg up was weaker than the first.

Step 6

Signal 6: Social Media Hype Reaches a Fever Pitch

When your friends, family, and coworkers who have never mentioned crypto before suddenly start asking which coins to buy, the market is likely near a top. This is not just an anecdote; it is measurable. Platforms like Santiment and LunarCrush track social media mentions, Google Trends data, and community engagement metrics across Twitter, Reddit, Telegram, and YouTube. When these metrics reach extreme levels, it indicates that mainstream retail is flooding in at peak prices, which is the final stage of a bull market.

Track the Google Trends score for terms like "buy Bitcoin," "crypto," and "how to buy crypto." When these search terms spike to values of 90 or above on the Google Trends 0-100 scale, retail mania is at its peak. In November 2021, Google Trends for "buy crypto" hit 100, its maximum reading, in the same week Bitcoin topped. Also watch for an explosion of crypto content from non-crypto influencers and mainstream news outlets running front-page stories about Bitcoin. When the taxi driver, the hairdresser, and your grandmother are talking about crypto, the smart money has already sold. It sounds cliche because it has been true in every single cycle.

Step 7

Signal 7: Perpetual Futures Funding Rates Hit Extreme Levels

Perpetual futures funding rates are periodic payments between long and short traders that keep the futures price anchored to the spot price. When the funding rate is strongly positive, it means long traders are paying short traders, indicating the market is overwhelmingly positioned to the upside. Extreme positive funding rates mean traders are paying a steep premium to maintain leveraged long positions, a condition that creates a powder keg of liquidations if the price dips even slightly.

On Binance, the funding rate is displayed on every perpetual futures pair and updates every 8 hours. Normal funding rates range from 0.01% to 0.03% per 8-hour period. When funding rates sustain above 0.05% to 0.10% for multiple consecutive periods, and especially when they spike above 0.10%, the market is dangerously overleveraged to the long side. You can track aggregate funding rates across multiple exchanges using CoinGlass (formerly Bybt). In the days before the April 2021 crash from $64,000, Bitcoin perpetual funding rates on Binance sustained above 0.08% for several consecutive periods, while some altcoin funding rates exceeded 0.20%, annualized rates of over 200%. Within days, the market crashed 35% in a cascade of long liquidations. When funding rates go extreme, take profits and do not add new leveraged positions.

Step 8

Putting It All Together: The Confluence Framework

No single signal is a guaranteed market top indicator on its own. The power comes from confluence, when multiple signals align simultaneously. Create a simple scoring system: assign one point for each of the seven signals that is currently flashing. At one to two points, stay alert but continue holding. At three to four points, begin actively taking profits by selling 20% to 30% of your position. At five or more points, shift into aggressive profit-taking mode and sell 50% or more of your holdings into the strength.

Keep a weekly checklist where you evaluate each of the seven signals every Sunday evening. Record the current value for each metric: weekly RSI level, Fear and Greed Index reading, distance from 200-day MA, exchange inflow trend, volume comparison to previous highs, social media hype metrics, and funding rate levels. This takes about 15 minutes per week and gives you an objective, data-driven framework for the most important decision in crypto: when to sell. The investors who track these signals do not need to call the exact top. They just need to sell into the top 10% to 20% of the price range, which is exactly what this system is designed to accomplish.

Tips & Best Practices

• Set up a free TradingView alert for when Bitcoin weekly RSI crosses above 80. This automated notification ensures you do not miss one of the most important early warning signals even if you are not actively watching the charts.
• Bookmark CryptoQuant, Glassnode, CoinGlass, and alternative.me/crypto/fear-and-greed-index and check them as part of a weekly routine rather than daily. Checking too frequently leads to overreaction on noisy short-term data.
• When three or more signals are flashing simultaneously, prioritize taking profits on your altcoin positions first. Altcoins historically crash 80% to 95% from their highs while Bitcoin typically drops 70% to 80%. Protecting altcoin gains is more urgent than protecting Bitcoin gains.
• Keep a written record of what each signal looked like at every local top and bottom during the current cycle. This personal data set becomes invaluable for the next cycle when you can compare live readings to your historical notes and act with more confidence.
• Share your signal checklist with a trusted friend or accountability partner who also invests in crypto. Having someone who holds you to your plan when greed is screaming to hold longer can be the difference between locking in profits and watching them disappear.

Important: These signals are based on historical patterns and are not guaranteed to predict future market tops with precision. Markets can remain irrational longer than you expect, and a signal that flashes early can stay elevated for weeks before the actual top occurs. Use these indicators as a framework for gradually reducing risk, not as a trigger for panic-selling your entire portfolio in a single transaction. Selling too early in a bull market is a real risk, which is why a phased DCA-out approach combined with signal monitoring is far more effective than binary all-in or all-out decisions.

Frequently Asked Questions

What is the single most reliable signal that a crypto market top is near?

No single signal is the most reliable in isolation. However, bearish RSI divergence on the weekly chart combined with extreme funding rates has historically been the most potent two-signal combination. When the weekly RSI fails to confirm a new price high while perpetual futures funding rates are sustained above 0.08%, a significant correction has followed within two to four weeks in most historical instances.

Can these signals help me time altcoin tops as well?

Yes, but altcoin tops are even harder to time because they often peak at different times. Many altcoins peak before Bitcoin during the first major leg up, while others peak after Bitcoin during a final euphoric alt-season rotation. Apply the same signals with tighter thresholds for altcoins, such as starting to take profits at RSI 80 on the daily rather than the weekly, and monitor altcoin-specific metrics like token unlock schedules and decentralized exchange liquidity.

How far in advance do these signals typically appear before a major top?

The lead time varies by signal. Funding rate extremes and exchange inflow spikes tend to appear one to seven days before a local top. Declining volume and RSI divergence can appear one to four weeks in advance. Social media hype and Fear and Greed extremes often persist for one to three weeks at the cycle peak. This is why a phased selling approach works better than trying to pinpoint the exact day: the signals give you a window, not a precise timestamp.

CryptoTakeProfit Research Team

Our team of analysts and traders covers the crypto market daily. We combine on-chain data, technical analysis, and fundamental research to bring you actionable insights.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments carry significant risk. Always do your own research and never invest more than you can afford to lose. This article may contain affiliate links.