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Bitcoin miner ‘capitulation event’ may have already happened — Research

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Bitcoin (BTC) miners may have already sparked a “capitulation event,” fresh analysis has concluded.

In an update on June 24, Julio Moreno, senior analyst at on-chain data firm CryptoQuant, hinted that the BTC price bottom could now be due.

BTC price bottom “typically” follows miner capitulation

Miners have seen a dramatic change in circumstances since March 2020, going from unprecedented profitability to seeing their margins squeezed.

The dip to $17,600 — 70% below November’s all-time highs for BTC/USD — has hit some players hard, data now shows, with miner wallets sending large amounts of coins to exchanges.

This, CryptoQuant suggests, precedes the final stages of the Bitcoin sell-off more broadly in line with historical precedent.

“Our data demonstrate a miner capitulation event that has occurred, which has typically preceded market bottoms in previous cycles,” Moreno summarized.

Miner sales have been keenly tracked this month, with the Bitcoin Twitter account even describing the situation as miners “being drained of their coins.”

“For miners, it’s time to decide to stay or leave,” CryptoQuant CEO, Ki Young Ju, added in a Twitter thread last week.

The situation is tenuous, but the majority of miners remain active, as witnessed by network fundamentals dropping only slightly from all-time highs of over 30 trillion.

Bitcoin network fundamentals overview (screenshot). Source: BTC.com

Mixed signals over buyer interest

When it comes to other large BTC holders, however, the picture appears less clear.

Related: ‘Foolish’ to deny Bitcoin price can go under $10K — Analysis

After whales bought up liquidity near $19,000, CryptoQuant’s Ki this week heralded the arrival of “new” large-volume entities.

Outflows from major United States exchange Coinbase, he noted, reached their highest since 2013.

Trader and analyst Rekt Capital, nonetheless, reiterated doubts about the strength of overall buyer volume, arguing that sellers were conversely still directing market movements.

Bitcoin’s 200-week moving average (MA), a key support level during previous bear markets, has yet to see significant interest from buyers despite the spot price being around $2,000 below it.

“Current BTC buy-side volume following the extreme sell volume spike is still lower than the 2018 Bear Market buyer follow-through volume levels at the 200-week MA. Let alone March 2020 buy-side follow-through,” he told Twitter followers.

BTC/USD annotated chart. Source: Rekt Capital/ Twitter

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.



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Key Bitcoin price metrics say BTC bottomed, but traders still fear a drop to $10K

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The crypto market is currently going through a period of heightened volatility as global economic conditions continue to worsen amid a backdrop of rising inflation and interest rates. 

As the headwinds impacting global financial markets beat down all traces of bullish sentiment, many crypto investors are predicting that Bitcoin (BTC) price could drop to as low as $10,000 before a market bottom is found.

BTC/USDT 1-day chart. Source: TradingView

While many traders scoffed at the idea of BTC falling below its 2017 all-time high, the recent dip to $17,600 suggests that this bear market could be different from the last one.

Here’s what several analysts are saying about the possibility of Bitcoin falling to $10,000 in the next few weeks.

Historic pullbacks point to a low at $10,350

Insight into how BTC may perform in the short-term can be gleaned by looking at its performance during the bear market cycles of 2013 and 2017. In 2013, the maximum drawdown for Bitcoin was 85%, which took place over a period of 407 days. The maximum drawdown in 2017 was 84% and this period lasted for 364 days.

Historical drawdowns for Bitcoin. Source: Arcane Research

According to a recent report by Arcane Research, the current drawdown has been going on for 229 days and has thus far seen a maximum drawdown of 73%.

Arcane Research said,

“If Bitcoin follows the blueprint of these cycles, a bottom should occur sometime in late Q4 2022, at a price as low as $10,350.”

While there is always a chance that an 85% pullback is a possibility, Arcane Research also noted that “Bitcoin is now far more intertwined in the broad financial markets, with the Fed, U.S. elections, crypto regulations and stock market impacting its performance.”

Further evidence that supports the possibility of a drop to the $10,000 range was touched upon by cryptocurrency research firm Delphi Digital, who posted the following chart noting that “From a high timeframe market structure perspective, the next place we have to be looking at is $10K–$12K.”

Brave new coin index for Bitcoin (BLX) 1-month chart. Source: Delphi Digital

Based on the chart above, the high timeframe market structure support is likely to exist between $9,500 and $13,500.

Delphi Digital said,

“Coincidentally, this area lines up with the implied low if BTC experiences an 85% drawdown from peak to trough.”

Would $10,000 be a good spot to go long?

Not every analyst expects a drop to $10,000. Take for example, Will Clemente of Blockware Solutions. According to Clemente, Bitcoin’s current range reflects a good spot for accumulation.

Additional data from Glassnode shows that Bitcoin’s 200-week moving average, balance price and delta price in its bear market floor model align with the 0.6 Mayer Multiple metric analyzed by Clemente.

Bitcoin bear market floor models. Source: Glassnode

Glassnode said,

“Only 13 out of 4,360 trading days (0.2%) have ever seen similar circumstances, occurring in just two prior events, Jan 2015 and March 2020. These points are marked in green on the chart.”

Based on the Delta price metric, which still remains untouched, the potential low for BTC is $15,750.

Related: Bitcoin’s short-term price prospects slightly improved, but most traders are far from optimistic

BTC/USD 1-month chart. Source: Twitter

John Bollinger, the creator of the popular Bollinger Bands trading indicator also suggested that Bitcoin price may have bottomed.

According to Bollinger:

“Picture perfect double (M-type) top in BTCUSD on the monthly chart complete with confirmation by BandWidth and %b leads to a tag of the lower Bollinger Band. No sign of one yet, but this would be a logical place to put in a bottom.”

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.



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Different this time? ‘Almost all’ Bitcoin metrics are now hinting at a price bottom

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Bitcoin (BTC) played wait-and-see with traders on June 28 as Wall Street opened to flat performance.

BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView

Bollinger eyes “logical place” for Bitcoin bottom

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD circling $21,000 on Bitstamp, refusing to commit to a firm trend.

The pair nonetheless avoided fresh signs of weakness, leading Cointelegraph contributor Michaël van de Poppe to believe that an attack on important levels — notably the 200-week moving average near $22,400 — could be next. 

“In the past, Bitcoin has been a steal under its realized price, i.e., aggregate cost basis of all coins in supply. The realized price is currently sitting at around $22,500,” popular trading account Game of Trades added.

While few expected a clear bullish trend to emerge, long-term perspectives also placed importance on current price levels.

Among them was John Bollinger, creator of the Bollinger bands volatility indicator, who in a fresh take on BTC/USD flagged the culmination of a trend years in the making.

The next move, he suggested, could well be higher after a “picture perfect” double top pattern on Bitcoin in 2021.

Research: “Almost all” Bitcoin metrics at all-time lows

Further analysis of whether the bottom is in for Bitcoin came from on-chain analytics firm Glassnode as the week began.

Related: 3 charts showing this Bitcoin price drop is unlike summer 2021

In its latest weekly newsletter, “The Week On-Chain,” Glassnode dissected a raft of on-chain metrics in various stages of signaling a bottom formation.

In an unprecedented macro environment, however, nothing was certain.

“Within the current macroeconomic framework, all models and historical precedents are likely to be put to the test,” it concluded.

“Based on the current positioning of Bitcoin prices relative to historical floor models, the market is already at an extremely improbable level, with only 0.2% of trading days being in similar circumstances.”

It noted that those who had bought BTC in 2020 and 2021 had provided the driving force behind recent selling.

“Almost all macro indicators for Bitcoin, ranging from technical to on-chain, are at all-time lows, coincident with bear market floor formation in previous cycles. Many are trading at levels with just single-digit percentage points of prior history at similar levels,” the newsletter added.

Sentiment was no different on the day, with the Crypto Fear & Greed Index at 10/100 or “extreme fear,” also constituting a classic reversal level in bear markets gone by.

Crypto Fear & Greed Index (screenshot). Source: Alternative.me

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.



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Community reacts after SEC’s Gensler affirms BTC’s commodity status

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Securities and Exchange Commission Chairman Gary Gensler riled up Crypto Twitter on Monday after affirming that Bitcoin (BTC) is a commodity. Questions were raised about its impact on Grayscales’ proposed Bitcoin ETF and why Ethereum wasn’t mentioned.

Speaking to Jim Cramer on CNBC’s Squawk Box on Monday, June 27, the SEC chair said while many crypto-financial assets have the key attribute of a security, Bitcoin is the “only one” that he was comfortable publicly labeling as a commodity.

“Some, like Bitcoin — and that’s the only one I’m going to say because I’m not going to talk about any one of these tokens, but my predecessors and others have said they’re a commodity.”

Grayscale Bitcoin ETF

The remarks kicked up chatter about Grayscale’s application to convert its Bitcoin Trust into a spot-based exchange-traded fund (ETF) — which is expected to see a yes-or-no decision from the SEC on July 6.

James Seyffart, an ETF analyst at Bloomberg Intelligence, told his 19,300 Twitter followers that while Gensler’s remarks are positive for Bitcoin, it may not be enough to see Grayscale’s Bitcoin-spot ETF approved next week.

Eric Balchunas, a senior ETF analyst at Bloomberg, made similar comments, noting he saw only a 0.5% chance of Grayscale’s GBTC being allowed to convert to an ETF. 

No mention of ETH

Crypto Twitter also picked up on the fact that Gensler refrained from mentioning whether he placed Ethereum (ETH) in the same commodities boat, despite the regulator and the Commodity Futures Trading Commission (CTFC) previously agreeing that the asset was a commodity just like Bitcoin.

Positive for Bitcoin

Nevertheless, Gensler’s views on Bitcoin have been seen as a positive for the king of crypto.

Bitcoin bull Michael Saylor shared the video to his 2.5 million Twitter followers, adding that Bitcoin is essential as a treasury reserve asset, which will allow governments and institutions to support it as a digital asset to grow the economy.

Meanwhile, Eric Weiss, founder of Blockchain Investment Group noted on Twitter that Gensler is the second SEC chair to declare Bitcoin a commodity, making it near impossible for this classification to be altered in the future.

Related: Google users think BTC is dead — 5 things to know in Bitcoin this week

Interestingly, the positive news for Bitcoin resulted in another price decline, falling from a 24-hour high of $21,478 to $20,635 at the time of writing.

Ethereum has fallen from a 24-hour high of $1,234 to $1,171 at the time of writing as the bears retain their grip on the markets.



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