As a seasoned researcher with over a decade of experience in the cryptocurrency market, I’ve seen my fair share of bull and bear runs, and I must admit, this current phase is intriguing. After witnessing Bitcoin and Ethereum reach their peaks in March 2024, only to plunge in August, it’s hard not to feel a sense of deja vu. However, the recent uptick in both coins’ hash rates and open interest gives me cautious optimism.
The prices of both Bitcoin and Ethereum declined following their peaks in March 2024. After Bitcoin reached new record highs at approximately $73,800, it took just about five months for its value to plunge significantly, dropping below $50,000 in early August.
During this market downturn, Ethereum wasn’t immune either. By August 5, its value dropped to a minimum of $2,100. Despite brief price recoveries following these losses, the upward trend has been unstable, and there are concerns that buyers may not be able to maintain the price increase.
Bitcoin Hash Rate Rising: Miner Capitulation Over?
Meanwhile, traders keep a close eye on the market, assessing the performance of the leading cryptocurrencies and waiting to see if they can recover, on-chain indicators suggest positive trends.
According to data from CryptoQuant, it appears that both Bitcoin and Ethereum could be nearing the final stages of a market downturn and are expected to surge further in an upward price trend, potentially extending the gains seen during Q1 of 2024.
In their latest post on X, the team at CryptoQuant discussed the current condition of Bitcoin mining and whether miners have bounced back following the capitulation event in July. Referencing the Hash Ribbon indicator, a popular metric used by analysts to gauge capital outflows, they noted that the network’s hash rate is on an upward trend, reaching new record highs of 638 EH/s recently.
After the halving event on April 20, miners improved their equipment in response to this development, resulting in an increase of computational power as they strive to stay competitive from August onwards.
It’s understandable that miners seem optimistic about the future, which is likely why they are choosing to invest again in advanced and productive equipment.
Historically speaking, analysts have observed that periods like the current one, where miners seem to be ending their capitulation, tend to be followed by significant increases in price.
Despite the fact that historical prices rarely reoccur exactly, there’s a good chance they’ll echo similar patterns. As such, it’s likely that the price will bounce back, surpass $60,000 again, and encounter resistance at around $63,000.
The primary cause for this growth will be the decrease in Bitcoin selling pressure by optimistic miners.
Ethereum Buyers Taking Charge As Open Interest Rises
Meanwhile, one analyst, citing CryptoQuant, notes that Ethereum could also be primed for gains. Currently, ETH bulls are struggling to unwind August 4 and 5 losses.
If bulls continue their momentum, breaking through the $2,800 resistance might signal the start of another price surge. This could potentially propel the price upward to around $3,500, marking a rejuvenating market recovery.
According to the analyst’s observation, the balance between purchasing and selling activity on Ethereum, as indicated by the Taker Buy Sell ratio, has been increasing. This trend indicates that the number of buyers is becoming more dominant, which could be favorable news for those who support a bullish outlook.
Concurrently, the number of open positions in Ethereum’s leveraged futures trades across multiple platforms has been increasing following a dip, particularly in June 2024. This suggests that investors are becoming more confident and could potentially spark a price surge.
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2024-08-21 09:12