​Analyst points to the end of bitcoin miners’ capitulation

The material is not an investment recommendation and is published for information purposes only.

What’s new? On January 20, the bitcoin hashrate set another all-time high, and the Hash Ribbons indicator pointed to the end of miners’ capitulation and the opening of opportunities to buy the first cryptocurrency. These conclusions were reached by CryptoSlate expert James Van Straten after his technical analysis of the charts.

News on the CryptoSlate website

Hashrate is the total computational power in the bitcoin network. The mining difficulty determines the amount of computing power it takes to find a new block in the blockchain. The parameter changes every 2016 blocks, or about once every two weeks. This ensures that the time it takes to find a block is around 10 minutes.

Hash Ribbons is an indicator that is used to determine the global bottom of the bitcoin price and the possibility of miners’ capitulation. It was developed in 2019 by Charles Edwards, founder of Capriole Investments.

When capitulating, mining costs exceed the value of bitcoin for a long time, which forces miners to sell the mined asset to cover operating costs and leads to a decrease in quotations.

What else did the analyst state? According to Van Straten, the worst time for miners is behind after the 30-day moving average (MA) of the bitcoin hashrate crossed the 60-day MA and rose above it. At such moments, price momentum switches from negative to positive, which according to the analyst, represents a good buying opportunity for the asset.

Moving Average is one of the most commonly used types of technical indicators showing the average value of the indicator over a certain time period.

As of January 23, 13:40 UTC, the BTC hashrate is 268,94 EH/s and the mining difficulty is 37,59 T. The asset is trading at $22 854, down by 0,23% in the last 24 hours, according to Binance.

On January 6, the bitcoin hashrate rose to a record 361,28 EH/s. The increase came from about 233 EH/s recorded on the same day, which was the second-largest one-day increase in the past year.