A historically accurate Bitcoin BTC/USD metric signals that the bottom could be in for the crypto market.
What Happened: Capitulation among Bitcoin miners tends to strongly correspond with market bottoms based on historical data, said CoinShares analyst Matthew Kimmell in an email to CNBC.
Capriole Investments chief Charles Edwards added on to Kimell’s statements with his own analysis of how miner behavior conveys a pattern for Bitcoin’s price.
Edwards told CNBC that when the 30-day moving average for Bitcoin mining hash rate falls below the 60-day moving average, it signals more miners shutting down their machines.
According to him, the worst of miner capitulation is over because the 30-day MA for hash rate is now back above the 60-day MA.
At this time, the 10-day MA for BTC price goes above the 20-day MA and creates a “buy signal,” Edwards said — confirming both these crosses occurred on Saturday.
“If previous cycles carry predictive power, then yes, bitcoin price steadily outpacing hashrate would likely precede a period of high price growth,” added CoinShares’ Kimmell.
See Also: IS BITCOIN A GOOD INVESTMENT?
Price Action: At press time, BTC was trading at $21,528, down 68% from its all-time high ahead of $69,000. The leading digital asset was mildly outperformed by Ethereum ETH/USD and Dogecoin DOGE/USD over 24 hours.