Bitcoin Collapses to $37K as Miners Start Dumping Their Coins

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Sun, 01/10/2021 - 17:55
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Alex Dovbnya
Bitcoin is in the middle of a "pretty huge correction" due to selling pressure from miners, according to CryptoQuant CEO Ki Young Ju
Bitcoin Collapses to $37K as Miners Start Dumping Their Coins
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Bitcoin, the largest cryptocurrency, dropped below the $38,000 at 17:23 UTC on the Bitstamp exchange after trading at as high as $41,450 earlier today.   

The cryptocurrency is currently down almost five percent over the past 24 hours. 

Bitcoin
Image by tradingview.com

Miners are in a selling mood      

As noted by CryptoQuant CEO Ki Young Ju, the Miners' Position Index (MPI) recently reached its highest level since July 2019, the month Bitcoin topped out at roughly $13,700 before seeing a huge correction.    

Miners
Image by @ki_young_ju

Very high MPI readings suggest that miners are actively taking profits instead of accumulating, thus exerting pressure on the market.     

Related Mike Novogratz Warns Bitcoin Could Go Down If Speculative Bubble Bursts
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Mike Novogratz Warns Bitcoin Could Go Down If Speculative Bubble Bursts

Bitcoin is extremely overbought 

Earlier today, NorthmanTrader's lead market strategist Sven Henrich noticed that the relative strength index (RSI) had reached 93, it highest level ever, on the weekly Bitcoin chart. This suggests that the volatile commodity is extremely overbought. 

NorthmanTrader
Image by @NorthmanTrader

However, earlier this week, veteran trader Peter Brandt claimed that assets typically remain overbought during raging bull markets, which is exactly what happened during Bitcoin's last bullish cycles.            

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About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets, can be contacted at alex.dovbnya@u.today.