Bitcoin is discounted near its ‘realized’ price, but analysts say there’s room for deep downside

May 17, 2022 Coin Telegraph

On-chain data suggests Bitcoin price is discounted, but analysts caution against expecting a rapid recovery.

There are early signs of the "dust settling" in the crypto market now that investors believe that the worst of the Terra (LUNA) collapse looks to be over. Viewing Bitcoin's chart indicates that while the fallout was widespread and quite devastating for altcoins, BItcoin (BTC) has actually held up fairly well.

Even with the May 12 drop to $26,697 marking the lowest price level since 2020 multiple metrics suggest that the current levels could represent a good entry to BTC.

*BTC/USDT 1-day chart. Source: TradingView*

The pullback to this level is notable in that it was a retest of Bitcoin’s 200-week exponential moving average (EMA) at $26,990. According to cryptocurrency research firm Delphi Digital, this metric has historically “served as a key area for prior price bottoms.”

*BTC/USD vs. 200-week EMA vs. 14-week RSI. Source: Delphi Digital*

And it wasn’t just Bitcoin that had a rough day on May 12. The stablecoin market also saw its highest level of volatility and deviation from the dollar peg since the start of the Terra saga, with Tether (USDT) experiencing the largest deviation among the major stablecoin projects as shown in the chart below from blockchain data provider Glassnode.

*Stablecoin prices during Terra's meltdown. Source: Glassnode*

All four of the top stablecoins by market cap have managed to return to within $0.001 of their dollar peg, but the confidence of crypto holders in their ability to hold has definitely been shaken by the events of the past two weeks.

Bitcoin approaches its realized price

As a result of the market pullback, the price of Bitcoin is now trading the closest it has been to its realized price since 2020.

*Bitcoin realized price. Source: Glassnode*

According to Glassnode, the realized price has historically “provided sound support during bear markets and has provided signals of market bottom formation when the market price trades below it.”

Previous bear markets saw the price of BTC trade below its realized price for extended periods of time, but the amount of time has actually decreased every cycle with Bitcoin only spending seven days below its realized price during the bear market of 2019–2020.

*Days Bitcoin spent below its realized price during previous bear markets. Source: Glassnode*

It remains to be seen if BTC will fall below the realized price should the current bear market conditions persist, and if so, how long it will last.

On-chain data shows that many crypto holders couldn’t resist the temptation of acquiring Bitcoin below $30,000, resulting in a spike in accumulation beginning on May 12 and continuing through May 15, but some analysts caution against taking this as a sign that a rapid recovery will occur from here.

If history is any indication, most #BTC Bear Market bottoms form quickly, in a volatile manner

But the accumulation ranges that form afterwards take time

Chances are there will be sufficient time to accumulate at deeply discounted prices$BTC #Crypto #Bitcoin
— Rekt Capital (@rektcapital) May 13, 2022

This sentiment was echoed by Delphi Digital, which noted that “the longer we see price build in these areas, further continuation becomes more likely.”

Delphi Digital said,

“In the event this happens, look for the following levels: 1) Weekly structure and volume structure support at $22,000–$24,000; 2) 2017 all-time high retests of $19,000–$20,000.”

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Bitcoin price could bounce to $35K, but analysts say don’t expect a ‘V-shaped recovery’

May 13, 2022 Coin Telegraph

Bitcoin Price

Daily closes above $30,000 could be a sign that BTC price is ready to consolidate, but traders warn against “generational bottoms” and “V-shaped” recoveries.

Altcoins saw a relief bounce on May 13 as the initial panic sparked by Bitcoin's sell-off Terra's UST collapse and multiple stablecoins losing their dollar peg begins to decrease and risk loving traders look to scoop up assets trading at yearly lows.

*Daily cryptocurrency market performance. Source:* *Coin360*

Despite the significant correction that occurred over the past week, Bitcoin (BTC) bulls have managed to claw their way back to the $30,000 zone, a level which has been defended multiple times during the 2021 bull market.

Here’s a look at what several analysts have to say about the outlook for Bitcoin moving forward as the price attempts to recover in the face of multiple headwinds.

Is a short squeeze pending?

Insight into the minds of derivatives traders was provided by cryptocurrency analytics platform Coinalyze, which assessed Bitcoin long to short positions for BTC/USD perpetual contracts on ByBit.

*BTC/USD perp 1-day chart vs. long/short BTC/USD accounts ratio. Source: Twitter*

As shown in the lower half of the chart above, the interest in shorts, which is represented in red, has surged during the recent market downturn indicating that derivatives traders expected more downside in the short term.

"The sentiment was very negative over the last few days, as seen in ByBit long/short ratio and funding rate. A short squeeze/bounce is expected" Coinalyze founder Gabriel Dodan told Cointelegraph in private comments.

A short-term breakout to $35K is expected

Bitcoin’s dip to $26,716 on May 12 was notable in that it broke below the May 2021 low at $28,600, “which was seen as the last man standing for BTC” according to David Lifchitz, managing partner and chief investment officer at ExoAlpha.

In Lifchitz's view, the bounce seen on May 13 was to be expected as “a lot of bad news had been flushed out” while the “panic move from the UST fiasco has already occurred.”

Bitcoin sitting at the May 2021 lows “seems like a good entry point here with a tight stop should the purge continue” according to Lifchitz, but traders shouldn’t expect a return to $60,000 to happen overnight and instead should set a more modest short term target of $35,000.

Lifchitz said,

“Long at $28.5K / Stop at $26.5K / Profit Target at $34.5K = $6K upside / $2K downside = 3/1 win/loss ratio and from an investment point of view, it looks compelling to me.”

A V-shaped recovery is unlikely

Insight into what it would take for Bitcoin to regain its bullish momentum was provided by market analyst and pseudonymous Twitter user ‘Rekt Capital’, who posted the following chart noting that BTC “needs to keep $28,600 as support for the price to challenge $32,000,” while a “weekly close below the green would be bearish.”

While many optimistic traders are hoping for a rapid recovery from this latest downturn, Rekt Capital warned that “by standards of history, a sharp V-Shaped recovery to mark out a generational bottom is less likely.”

The analyst said,

“Many expect one as the previous March 2020 BTC bear market bottom was very volatile. But macro price history suggests extended ranges are more likely.”

The overall cryptocurrency market cap now stands at $1.287 trillion and Bitcoin’s dominance rate is 44.4%.

Buy the dip, or wait for max pain? Analysts debate whether Bitcoin price has bottomed

May 13, 2022 Coin Telegraph

Bitcoin Price

BTC is flashing a few early bottoming signals, but analysts question whether “buying the dip” is a wise maneuver given the strength of the dollar and other factors.

It has been a rough week for the cryptocurrency market, primarily because of the Terra ecosystem collapse and its knock-on effect on Bitcoin (BTC), Ethereum (ETH) and altcoin prices, plus the panic selling that took place after stablecoins lost their peg to the U.S. dollar.

The bearish headwinds for the crypto market have been building since late 2021 as the U.S. dollar gained strength and the United States Federal Reserve hinted that it would raise interest rates throughout the year.

According to a recent report from Delphi Digital, the 14-month RSI for the DXY has now “crossed above 70 for the first time since its late 2014 to 2016 run up.”

*DXY index performance. Source: Delphi Digital*

This is notable because 11 out of the 14 instances where this previously occurred “led to a stronger dollar ~78% of the time over the following 12 months,” which points to the possibility that the pain for assets could get worse.

On average, the DXY gained roughly 5.7% after its RSI rose above 70, which from May 13’s reading “would put the DXY Index just shy of 111, its highest level since 2002.”

*BTC/USD vs. DXY Index (inverted) and a rolling 60-day correlation. Source: Delphi Digital*

Delphi Digital said,

“Assuming the correlation between the DXY and BTC remains relatively strong, this would not be welcoming news for the crypto market.”

Bitcoin is at a key area for price bottoms

Taking a bigger picture approach, BTC is now retesting its 200-week exponential moving average (EMA) near $26,990, which has “historically served as a key area for price bottoms” according to Delphi Digital.

Bitcoin is also continuing to hold above its long-term weekly support range of $28,000 to $30,000, which has proven to be a strong area of support throughout the recent market turmoil.

While many traders have been panic selling in recent days, Pantera Capital CEO Dan Morehead has taken a contrarian approach, noting, “It’s best to buy when [the] price is well below trend. Now is one of those times.”

*Bitcoin fund inflows relative to price trend. Source: Twitter*

Morehead said,

“Bitcoin has been this “cheap” or cheaper relative to trend only 5% of time since Dec 2010. If you have the emotional and financial resources, go the other way.”

A word of caution was offered by Delphi Digital, however, which noted that “the best opportunities or "deals" in the market are not around for long.”

Since BTC has been trading in the $28,000 to $30,000 range for an extended period of time, “the longer we see price build in these areas, further continuation becomes more likely."

If further decline occurs, the “weekly structure and volume structure support at $22,000 to $24,000” and the “2017 all-time high retests of $19,000 to $24,000” are the next major areas of support.

Delphi Digital said,

“Early signs of capitulation are starting to bleed through, but we can’t say we’re nearing the point of max pain just yet.”

Altcoins stage a relief rally while Bitcoin traders decide whether to buy the dip

May 10, 2022 Coin Telegraph

Bitcoin Price

Stocks and altcoin prices bounced as the sell-off in BTC took a pause, but analysts continue to warn that further downside could occur shortly.

The similarity in price action between the crypto and traditional financial markets remains quite strong on May 10 as traders enjoyed a relief bounce across asset classes following the May 9 rout, which saw Bitcoin (BTC) briefly dip to $29,730.

Market downturns typically translate to heavier losses in altcoins due to a variety of factors, including thinly traded assets and low liquidity, but this also translates into larger bounces once a recovery ensues.

Several projects notched double-digit gains on May 10, including a 15.75% gain for Maker (MKR), the protocol responsible for issuing the DAI (DAI) stablecoin, which likely benefited from the fallout from Terra (LUNA) and its TerraUSD (UST) stablecoin.

Other notable gainers include Persistence (XPRT) and its liquid staking token pSTAKE (PSTAKE), which experienced gains of 16.4% and 39.8% after Binance Labs revealed a strategic investment in the liquid staking platform. Polygon (MATIC) also bounced back with a 14.59% gain .

Correlation with traditional markets remains

Despite the widely held belief that the crypto market would act as a hedge to TradFi volatility, the correlation between Bitcoin and the stock market has remained high in 2022.

If anything, the volatility usually associated with the cryptocurrency market has begun to rear its ugly head in traditional markets, as evidenced by the price action for the Dow Jones Industrial Average on May 10, which rose more than 500 points only to give back at the time of writing.

The Nasdaq and S&P 500 have fared a little better, notching gains of 0.9% and 1.92%, respectively.

Further evidence to support a correlation between crypto and traditional markets was provided by Bitcoin analyst Willy Woo, who posted the following chart noting that “Fundamentals [are] taking a back seat to fear driven trading.”

*BTC/USD 1-week chart vs. SPX 1-week chart. Source: Twitter*

Willy Woo said,

“What I do think is we are not trading BTC, we are trading macro and equities. Right pane is SPX support, which will determine BTC directionality, left pane is the equivalent BTC support.”

The S&P 500 could drop much further

While May 10's relief rally sent crypto and stock prices higher, market analyst Caleb Franzen posted the following chart warning about a bearish head and shoulders formation on the S&P 500 chart that could result in the loss of another 500 points.

Franzen said,

“Hard to pick downside targets after my $4,000 call got hit, but I think the MOST LIKELY support zone is down around $3,530–$3,590. This is the white resistance range from September–October 2020.”

The overall cryptocurrency market cap now stands at $1.444 trillion and Bitcoin’s dominance rate is 41.5%.

Bitcoin retests key $30K support zone as data highlights BTC whale accumulation

May 9, 2022 Coin Telegraph

Bitcoin retests key K support zone as data highlights BTC whale accumulation

Bitcoin Price

Fear dominates the crypto market as BTC price trades near $30,000, but data suggests whales and momentum traders could be interested in accumulating in this zone.

Sentiment across the cryptocurrency market plunged even deeper on May 9 as an escalation in the ongoing sell-off intensified with bears pushing Bitcoin (BTC) to $30,334, its lowest price since July 2021.

*Crypto Fear & Greed Index. Source: Alternative.me*

Multiple factors like rising interest rates, the end of easy money policies by the Federal Reserve, declining stock prices and concerns related to Terra’s UST stablecoin maintaining its $1 peg are all impacting sentiment within the crypto market.

Data from Cointelegraph Markets Pro and TradingView shows that an afternoon of heavy selling on May 9 hammered the price of BTC to a daily low of $30,334 as bulls frantically regrouped to defend the psychologically important $30,000 price level.

Here’s a look at what several analysts are saying about the outlook for Bitcoin moving forward, along with some insight into how BTC whales are reacting to the recent price action.

Has a bear market started?

The possibility of a strong sell-off was discussed prior to Monday’s move by analyst and pseudonymous Twitter user ‘Nunya Bizniz’, who posted the following chart highlighting a possible zone of capitulation for Bitcoin.

Nunya Bizniz said,

“This 8-yr parallel channel has four perfect touches. Will there be another capitulation spike low within the yellow circle, between red and blue, aligning with the prior all-time high?

Based on the chart provided, the price of BTC could drop as low as $19,891 if such a scenario played out.

One way or another, what comes next for BTC is likely to ripple across the cryptocurrency market as the current streak of losses is nearing record-breaking territory as noted by pseudonymous Twitter user ‘Bitcoin Archive’.

#Bitcoin went down 6 weeks in a row for just the second time ever.

It has never had 7 red weeks in a row. pic.twitter.com/NNXuQUHQC9
— Bitcoin Archive (@BTC_Archive) May 9, 2022

Bitcoin price is trading below its 2-year moving average

A more positive take on the recent weakness was offered by crypto analyst Philip Swift, who posted the following chart looking at the BTC price relative to its 2-year moving average (MA).

*Bitcoin 2-year MA multiplier. Source: Twitter*

The analyst said,

“It's that time in the cycle again! Price has dropped below the 2yr MA. Accumulate.”

Whales wallets have been feasting

According to Twitter crypto analyst Akash, Bitcoin whales have been accumulating through the previous downturns and sideways price action.

*BTC price vs. wallets holding 10,000 to 100,000 BTC. Source: Twitter*

Akash said,

“Wallets holding 10,000 to 100,000 BTC have been on a buying spree since April 30.”

While this data is encouraging on some levels it's important to remember that there are no guarantees against another trend change or further downside and traders would be wise to assume nothing and take extra care to manage their risk moving forward.

The overall cryptocurrency market cap now stands at $1.411 trillion and Bitcoin’s dominance rate is 41.5%.

Bitcoin price falls to $31K as traders prepare for a ‘rocky’ road and more downside

May 9, 2022 Coin Telegraph

Bitcoin Price

BTC price hits a 2022 low as on-chain data points toward capitulation by traders adopting a risk-off approach to crypto and stocks.

“When it rains, it pours” is an old saying finding new relevance in the cryptocurrency markets on May 9 as traders face another day of pain and the current price decline brings Bitcoin (BTC) to its lowest level in 2022.

Data from Cointelegraph Markets Pro and TradingView shows that the BTC selloff on May 9 intensified as the trading day progressed with Bitcoin hitting a daily low of $31,000 as bulls scrambled to mount what amounted to a weak defense.

Here’s a look at some of the developments that led up to May 9’s price declines and what traders can look for as the crypto market heads deeper into bear territory.

Further downside is a possibility

Bitcoin bulls have struggled to establish a solid floor of support over the past couple of months because bears have been persistent in their drive to push the price lower.

Currently, BTC price down 50% from its all-time high in November and on-chain analysis firm Glassnode noted in a recent report that this decline “remains modest when compared to the ultimate lows of prior Bitcoin bear markets.”

*Bitcoin price drawdown from all-time highs. Source: Glassnode*

As shown in the graphic above, the drawdown in July 2021 reached a peak of -54.2% while the “bear markets of 2015, 2018 and March 2020 capitulated at lows between -77.2% and -85.5% off the all-time high.”

Network profitability has also declined to levels that are similar to what was seen during the late-2018 and late 2019–2020 bear markets.

*Bitcoin: Supply, entities and addresses in profit. Source: Glassnode*

Glassnode said,

"It should be noted that both instances were prior to the final capitulation flush out event. As such, further downside remains a risk, and would be within the realm of historical cycle performance."

Traders are taking a risk-off approach

A deeper dive into the on-chain data shows that the capitulation by Bitcoin holders has intensified in recent weeks as the price has continued to trend lower.

Evidence for this capitulation can be found looking at the Bitcoin exchange fee dominance, which measures what percentage of the fees on the Bitcoin network was paid to deposit BTC to an exchange.

*Bitcoin exchange fee dominance. Source: Glassnode*

According to Glassnode, the sudden spike in the Bitcoin exchange fee dominance to 15.2% is the second-highest level in history and “further supports the case that Bitcoin investors were seeking to de-risk, sell and/or add collateral to margin in response to market volatility.”

Additional evidence of a rise in risk-off sentiment can be found looking at stablecoin supplies, which have declined over the past two months after increasing from $5.33 billion to $158.25 billion since the market selloff in March 2020.

After reaching a peak of $161.53 billion in early April, the aggregate stablecoin supply has declined by $3.285 billion as an uptick in redemptions of USD Coin (USDC) has outpaced inflows across all stablecoin tokens.

*Aggregate stablecoin supply 30-day change. Source: Glassnode*

Glassnode said,

“Overall, there are a number of signals of net weakness in the space, many of which indicate that risk-off sentiment remains the core market position at this time.”

The possibility of holding above $30,000

The recent weakness across the market has led many crypto traders to flip bearish and accept the possibility of a decline to $28,000, which has started to pique the contrarian perspectives of some analysts including futures trader Peter Brandt, who posted the following tweet addressing the change in sentiment.

Now that 28,000 is so widely accepted as downside target I am forced to change my view. Either price holds above 30,000 or tanks through 28,000
— Peter Brandt (@PeterLBrandt) May 8, 2022

It remains to be seen what comes next for BTC, but it's best to prepare for more volatility because macro global events continue to put pressure on financial markets.

Glassnode said,

“Bitcoin remains highly correlated to the broader economic conditions, which suggests the road ahead may unfortunately be a rocky one, at least for the time being.”

The overall cryptocurrency market cap now stands at $1.467 trillion and Bitcoin’s dominance rate is 41.7%.

Fed FOMC comments and Bitcoin ‘bear channel’ could kickstart a decline to $28K

May 2, 2022 Coin Telegraph

Fed FOMC comments and Bitcoin ‘bear channel’ could kickstart a decline to K

Bitcoin Price

Crypto market weakness continues into May as analysts suggest that deteriorating sentiment could lead Bitcoin price to re-test $28,000.

The start of May has seen a continuation of the weakness in crypto and equities markets and at the moment, there is no indication of any short-term factors that could reverse the bearish trend.

Equities markets are also in a downtrend and according to researcher Clara Medalie, the price of stocks from companies with exposure to Bitcoin (BTC) have also taken a notable hit.

*Bitcoin vs. BTC exposed companies. Source: Twitter*

Medalie said:

“Block, Tesla, Microstrategy and Coinbase are down between 20%–50%.”

Data from Cointelegraph Markets Pro and TradingView shows that an early morning attempt by Bitcoin (BTC) bulls to rally above $39,000 was easily defended by bears, resulting in a pullback to the $38,200 level.

Here’s a look at what several analysts are saying about the current price action and what lower levels to keep an eye on in the case of further decline.

More downside until the 200-EMA flips to support

According to independent market analyst Rekt Capital, watching for a close above the 200-day exponential moving average (EMA) is an easy way to assess the current weakness of Bitcoin. The analyst described the metric as an “indicator of long term investor sentiment towards Bitcoin.”

Rekt Capital said,

“Since mid-2021, BTC hasn't been able to hold above the black 200-day EMA for too long. Every time BTC would break above the EMA, it would swiftly lose it as support and retrace lower.”

$28,000 could be the macro bottom

Insight into what could come next for the BTC price was touched on by crypto trader and pseudonymous Twitter user ‘Cantering Clark’, who posted the following chart highlighting the similarities between the current price action and BTC's price action in July 2021.

Cantering Clark said,

“Similar pattern of forceful sell-offs followed by weak attempts to pop upward as we saw in July 2021, again after a longer-term sideways range had forms and lows began to be favored. Possible trap setup.”

Veteran trader Peter Brandt also shared a similar sentiment, noting that the Bitcoin price could break down to new lows if the current "bear channel" plays out.

Brandt said:

“The completion of a bear channel typically results in a decline equal to the width of the channel, or in this case a hard test of $32,000 or so — my guess is $28,000.”

Long-term accumulation continues

Despite the current downtrend, data from glassnode suggests that BTC accumulation continues to increase, a fact highlighted by Twitter account Negentropic.

*Bitcoin long-term holder net position change. Source: Twitter*

The analysts said:

“Panicking short-term holders realized losses while the long-term holder net position change increased.”

The overall cryptocurrency market cap now stands at $1.72 trillion and Bitcoin’s dominance rate is 42.5%.

Bitcoin network difficulty breaks into a new all-time high of 29.794T

April 30, 2022 Coin Telegraph

Bitcoin mining

While Bitcoin miners continue to pursue the last 2 million BTC into circulation, the overall network is well-positioned to attain greater resilience against vulnerabilities.

Reassuring its position as the most resilient blockchain network against attacks, the Bitcoin (BTC) network recorded a new all-time high network difficulty for the second time this month in April — jumping from its previous all-time high of 28.587 trillion to 29.794 trillion.

Greater network difficulty demands greater computational power to successfully mine a BTC block, which prevents bad actors from taking over the network and manipulating transactions, also known as double-spending.

As evidenced by data from blockchain.com, Bitcoin’s network difficulty has seen almost a year-long uptrend since August 1, 2021. Before that, between May and July 2021, was a timeline when BTC network difficulty fell nearly 45.5% from 25.046 trillion to 13.673 trillion — at the time raising momentary concerns about the network’s vulnerability.

Bitcoin network difficulty. Source: Blockchain.com

Further cementing Bitcoin’s resilience against 51% attacks, on April 28, the Bitcoin network hash rate too recorded a new ATH of 258 EH/s. As shown below, the network hash rate eased down to the 220 EH/s mark by the end of the month with no visible negative impact on the BTC network difficulty.

Bitcoin total hash rate. Source: Blockchain.com

The month of April also was witness to one of the lowest average transaction fees on the Bitcoin network — the cost associated with transferring BTC. For the first time in two years, on April 18, the average BTC transaction fee fell down to $1.039, which at its highest was $62.788 in April 2021.

While Bitcoin miners continue to pursue the last 2 million BTC into circulation, the network is well-positioned to attain a newer all-time high with respect to overall security and price.

New research paints an optimistic picture about BTC, underscoring the strength of hodlers hoping for all-time highs.

As Cointelegraph reported, on-chain indicators suggest bullish momentum thanks to a lack of short-term holders (STHs), as noted by popular analyst “Root”:

“Since we didn't reach prices above 100K, which so many expected, many still believe this will eventually happen and might therefore hold on to their coins.”

Bitcoin halving analysis hints at $24K bottom before the end of 2022

April 29, 2022 Coin Telegraph

Bitcoin Halving

Traders say BTC’s current price action aligns with the Bitcoin halving model, leading some analysts to expect a $24,000 bottom before the end of the year.

One of the most popular topics of debate within the crypto community revolves around the Bitcoin (BTC) four-year halving cycle and the effect it has on the long-term price of the top cryptocurrency.

Bitcoin price failed to hit the long-predicted $100,000 level in 2021 and many crypto analysts now find themselves wondering about the outlook for the next six to 12 months.

Currently, BTC price trades below $40,000 and various technical analysis metrics suggest that further downside is more likely that a recovery to the $40,000 to $45,000 range. Let's take a look at what analysts' views are on Bitcoin's longer-term prospects.

Bitcoin could bottom in November or December

A general overview of the four-year cycle theory was discussed in a Twitter thread by crypto analyst and pseudonymous Twitter user "Wolves of Crypto," whose analysis indicates that “the most probable bear market bottom for Bitcoin will take place in November/December 2022.”

This projection assumes that the peak BTC price of $68,789 back on November 10, 2021 marked the high of the last cycle and that the market is currently in the corrective phase typically seen after a cycle top.

The analyst said,

“The 200–week SMA has been the long-tested bear market bottom indicator for Bitcoin, and hence, the bottom will likely be placed at ~$24,000.”

Should this model play out, the price of BTC will breakout above its previous all-time high sometime around August or September of 2023.

Bitcoin “seems a bit undervalued here”

The possibility that the bottom in BTC could come before the end of 2022 was hinted at by Willy Woo, an independent market analyst who posted the following chart suggesting that the “Orange coin seems a bit undervalued here.”

*Highly liquid supply shock oscillator. Source: Twitter*

The “Highly Liquid Supply Shock” metric quantifies on-chain demand and supply, and shows its relative movement in standard deviations from the long-term average.

As shown on the chart above, each time the oscillator dipped as low as the current reading, the price of BTC entered a sharp rally shortly thereafter.

Woo said,

“Not a bad time for investors to wait for the law of mean reversion to play out.”

Bitcoin price is at a mid-term low

Many analysts believe that BTC could be in an optimal accumulation range, a point touched on by crypto market analyst Philip Swift. According to Swift, the active address sentiment indicator (AASI) suggests that BTC is in a buy zone.

*Active address sentiment indicator. Source: Twitter*

According to Swift, the AASI is currently “back in the green zone,” which suggests that the “Bitcoin price change is at a sensible level relative to active address change.”

Swift said,

“This tool has a good hit rate across bull and bear markets for signaling a mid-term low.”

Indeed, a survey of the previous instances where the AASI hit levels similar to its current reading shows that the price of BTC hit its low point around the same time and proceeded to climb higher in the following weeks and months.

Generally, it appears as though Bitcoin's price action is keeping in-line with the previously established four-year cycle, albeit to a lesser percentage increase than expected.

Bitcoin network hash rate hit a new record high amid price volatility

April 28, 2022 Coin Telegraph

Bitcoin mining

Bitcoin network hash rate hit a new record high, seeing a 400% increase since the mining ban by China last year.

The hash rate of the Bitcoin (BTC) network hit a new ATH, even when the price of the top cryptocurrency struggled to get past the $40K mark.

The network's hash rate hit a new record high of 258 EH/s on Thursday before settling around the 220 EH/s mark.

The recent rise in the BTC network hash rate signifies the growing number of miners on the blockchain. The bitcoin network hash rate has grown more than 400% since the Chinese crypto mining ban last year when it fell below 70 EH/s.

The Bitcoin network managed to recover from the significant hashrate drop by the end of last year and has only grown in 2022.

Bitcoin network also saw an increase in mining difficulty to new historic highs, reaching 29.70 trillion. The mining difficulty is adjusted to keep the block generation time of 10 minutes constant. A rise in the mining difficulty signifies that more miners are competing against each other to mine the next block.

According to data from BTC.com, Bitcoin mining difficulty increased by 5% on April 27 and has seen three positive re-adjustments and two negative ones in 2022. The next difficulty adjustment is slated for May 10.

Bitcoin network has stood the test of times and various regulatory onslaughts. The rise in mining difficulty and network hashrate also comes at a time when there is a significant push for Bitcoin’s change to proof-of-stake from its current proof-of-work mining consensus.

Greenpeace, along with other climate groups, and co-founder and executive chairman of Ripple (XRP), Chris Larsen has launched a new campaign aimed at changing Bitcoin to a more environmentally friendly consensus model. However, core Bitcoin proponents continue to advocate for the current mining mechanism as it offers true decentralization.

While Bitcoin’s energy consumption has become a controversial topic, it has often been used to peddle fake narratives such as “BTC will use up all the energy by 2022.” With BTC gaining mainstream popularity, clean mining has become a priority for several mining companies.

BTC Markets