Bitcoin
Largest Miner Capitulation Since 2022 Signals Potential Bitcoin Rally Ahead — TradingView News
Bitcoin (BTC) has struggled to regain bullish momentum recently, remaining in a consolidation phase just above the crucial $60,000 support. Despite reaching an all-time high three months ago, the largest cryptocurrency witnessed a dip to $59,500 on Wednesday due to increased selling pressure from miners.
BTC Sales
The ongoing miner capitulation, the longest seen since summer 2022 before the FTX implosion, indicates the supply compression effect of the Bitcoin Halving.
Cryptocurrency analyst Ali Martinez noted that Bitcoin miners have sold over 2,300 BTC in the past 3 days, totaling approximately $145 million.
BTC News
This selling pressure from miners comes on top of recent BTC sell-offs by the US and German governments, contributing to downward pressure on the market and keeping prices within the lower range of the broader $60,000-$70,000 consolidation zone seen over the past few months.
Notably, addresses linked to the German and US governments sent $737 million worth of BTC to exchanges including Coinbase, Bitstamp and Kraken in multiple transactions.
As selling pressure from governments and miners eases over time, market observers expect a potential price recovery for BTC, following the typical pattern seen during the post-halving period, where new all-time highs are frequently reached.
Bitcoin Price Outlook
Market expert Scott Melker points out that the market could be approaching a crucial signal, stating that if a daily candle closes below the $60,300 level, it could lead to a bullish divergence.
This would involve the daily RSI (Relative Strength Index) moving out of oversold territory, similar to what happened last August when the price was around $26,000.
Melker emphasizes the need for a close below the mentioned level, followed by a clear upward movement in the RSI without making a lower low. A significant downward movement would be needed for the RSI to go below its level on June 24.
However, cryptocurrency analyst Andrew Kang highlights the significance of a potential loss of the four-month range in Bitcoin, drawing parallels with the range seen in May 2021 following a parabolic rally in BTC and altcoins.
Kang notes that over $50 billion in crypto leverage is currently at near-historical levels, compounded by the fact that the market has been in a prolonged consolidation phase for 18 weeks without experiencing extreme declines as seen during the 2020-2021 bull market.
Furthermore, Kang suggests that initial estimates of $50,000 may have been too conservative, and a more significant reset to $40,000 could be possible.
Such a pullback would substantially impact the market and would likely require a few months of choppy or falling price action before a reversal and an uptrend could be established.
At the time of writing, BTC had reclaimed the $60,350 level after its brief dip below this crucial support for further upward movement.
The largest cryptocurrency on the market has erased all gains on broader time frames and is currently recording a 12% price drop on a monthly basis.
Featured image of DALL-E, chart from TradingView.com