While traders are trying to figure out whether or not Bitcoin has already bottomed out, Charles Edwards of Capriole notes that the cryptocurrency is on the verge of flashing a rare ‘ribbon’ crossover.
Historically, it has been a powerful indicator that occurs during miner capitulations and precedes enormous gains.
The most bullish indicator
As explained by Edwards, such crossovers occur when Bitcoin’s mining difficulty, which is updated roughly every two weeks, cannot catch up with the falling hashrate.
The hash ribbon indicator has proven to be a reliable way of buying the bottom of every major correction. For instance, those who bought in January 2019 could have made a 285 percent return on their investment. Moreover, you could have increased your holdings by nearly 7,000 percent by buying BTC in January 2015.
Another miner capitulation?
With Bitcoin (BTC) changing hands just above $5,400, many miners are calling it quits. As reported by U.Today, Edwards expects the coin’s hash rare to start dropping soon. Crypto analyst Mati Greenspan calmed investors that it will simply allow new players to enter the market.
However, the halving, which will happen in fewer than 60 days, will most likely result in yet another wave of miner capitulation given that BTC has to trade above $15,000 for them to break even.
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