Bitcoin Miners In Capitulation: Will This Signal The Next Major Price Surge?
- Bitcoin’s market signals potential reversal as miners enter capitulation phase, with hash ribbon predicting price change at local lows.
- The hash ribbon, tracking 30- and 60-day hashrate averages, signals miner financial pressure when mining costs exceed Bitcoin’s value.
- Past miner capitulation events have led to Bitcoin rallies, with analysts confirming hash ribbon’s reliability for timing market entries.
Bitcoin’s market is signaling a potential price reversal as miners have entered a phase of ‘capitulation. Analytics account Bitcoindata21 Bitcoin is indicative of a potential such a picture has emerged that investing on hash ribbon indicator is often used to predict the price during local lows.
Hashrate and Mining Pressure
The hash ribbon represents the ratio of BTC’s hashrate 30-day moving average and hashrate 60-day moving average. When the 30-day moving average is below the 60-day moving average, it indicates that miners are under some sort of financial pressure. This phenomenon occurs when it is uneconomical to mine BTC due to the high cost of undertaking mining as compared to the market price of Bitcoin.
Source: GlassNode
Miner capitulation is relatively rare but could be observed before long and powerful impulse to bull market. Furthermore deploying several technical analysis tools, Bitcoindata21 indicated that when the 30-day moving average has crossed above the 60-day average, the bad stage of the capitulation phase is mostly complete. This is usually succeeded by an upward price action, which indicates that the market may be turning around.
Bitcoin’s Bullish Momentum Ahead
The last miner capitulation took place in mid-October in 2024, just prior to when BTC’s price rose from $73,800 to $108,000 within the span of two months. The market data when such capitulation events occur are always succeeded by a bullish run in the prices of BTC. The hash ribbon indicator has earned the credit of giving accurate signals about changes in the trend at these points.
A CryptoQuant analyst known as Darkfost also confirmed the efficacy of the hash ribbon. He said it has only been missed once and highlighted that was because of the unforeseen forces like the COVID-19 that distorted the market. Darkfost mentioned that each time there was a flash at the hash ribbon signaling a capitulation, BTC responded with a bounce, meaning, it is useful for timing the market.
Another market participant, Charles Edwards, the founder of Capriole Investments, also noted that BTC miners have upped the stakes in early February. From this data, they concluded that miners continue to acquire new BTC, suggesting that they expect it to rise in value in the future. This is in line with the general opinion that there is even the possibility of a change in the market direction.
The forcast on the price of Bitcoin is now turning slightly bullish which brings focus to the hash ribbon indicator and what miners will do soon. The following weeks could prove if this is the onset of a rally to the upside.
