New Signal From Indicator Heralding Big Bitcoin Rises

The indicator, which showed a buy signal when the price was 20 thousand dollars in December 2020, before the peak of 65 thousand dollars, and gave a "buy" signal once again when the price was 42 thousand dollars in August 2021, created another buy signal yesterday exactly one year later.

The indicator in question is called the “Hash Ribbon” and is used to determine ideal buy times. The basis of the indicator is based on the relationship between the hash rate and the price.

“When the hash rate’s 30-day moving average crosses its 60-day moving average, the worst of the ‘miner capitulation’ is over and the recovery begins,” said Charles Edwards, the developer of the indicator. Purchases at these points yield incredible results.” says.

Commenting after the indicator produced a new buy signal yesterday, Edwards said, “Bitcoin miner capitulation officially ended today, making it the 3rd longest capitulation in history with 71 days. This capitulation zone was longer than 2021 and just two days shorter than 2018, when the price dropped as low as $3100. Historically, Bitcoin miner capitulations have set price lows and have been great buy signals.” used the phrases.

How Do Miners Affect the Price?

As new BTCs are produced, miners sell some of the BTC they produce to cover their production costs. This creates a downward pressure in the price. High-cost miners sell more BTC to continue their operations. They shut down their devices when it becomes unsustainable. Afterwards, the hash power and Bitcoin production difficulty decrease, leaving only the strong miners. These are selling less, thus leaving more room for upward price action.

It is not right to act with a single indicator

On the other hand, experts advise not to set off with a single indicator when evaluating the possible future price action of the Bitcoin price. In the evaluations on the price, it is stated that the evaluation should be supported by different data as well as an indicator.