Bitcoin Difficulty CollapseThe bitcoin network difficulty has crossed the signal line on the 2 day chart and the 3 day chart for the first time ever. This could be an interesting long term sell signal.
Difficultyribbon
Bitcoin: Bullish but No Rush Hi, everyone. We are back! Sorry for the long absence. We’ve spent the past few months developing some awesome on-chain indicators, which will be released soon. :)
For BTC, we are currently at a crucial state, with many attempts at the 10k mark. All fundamentals considered, we do believe it is only a matter of time for the break to the upside. However, looking at miner behavior, we do think the consolidation would still need some time to play out. Historically, it has always been good accumulation opportunities after the weak miners’ sell off and capitulation. With only strong miners left, the miner selling pressure decreases. Recent data also shows a significant decrease in miners transferring BTC to exchange wallets after the halving, confirming the increasing miners’ short-term holding behavior.
How do miners react in large price drops / halving events?
--> Price drop / halving
--> Miner revenue decrease
--> Weak miners: sell more to maintain operational
--> Strong miners: holding and use existing cash for operational cost
--> Weak miners: not sustainable & capitulate
--> Only strong miners left (holding, not selling) --> mkt supply decrease
--> Price stabilize --> then rise
*credit to capriole_charles for the hash ribbon indicator.
BTCUSD: Miner Capitulation Is Here... Back Down To $3,800?The chart speaks for itself. The extrapoled price comes from the "2018 miner capitulation" that caused the price to drop 50%. Will we go back to $3,800? Unlikely, but clearly this is possible if the capitulation is as aggressive as 2018. Notably the VPVR is supporting the price target of $3,800, as is the extrapolation, with forecasted price for the block halving in May 2020 above $6K followed by another swift recovery and subsequent bull-run.
This isn't the first theory regarding price forming a higher low double bottom instead of holding the $5-6K area. As published last year, the 50 & 200 Day death cross also resulted in a 50% drop in price in 2014 and 2018, implying a 50% probability of such an outcome (using 4 sets of available data).
