From bitcoin (BTC) price crash causes a lot of panic in the market. And it looks like the end is not yet in sight. While we see some indicators here and there that indicate that a bottom is getting closer, people are now looking at the miners, among other things. For them, the $34,000 is a very important price zone.
Low Daily and Weekly Bitcoin RSI
Starting with a traditional momentum indicator; the Relative Strength Index (RSI). This indicator is very low on both the daily and weekly charts. This could be a sign that the market is very oversold is and that the bears are losing power. Analyst TechDev shows on the weekly chart how the RSI fared during previous corrections. At the moment we are very close to the RSI value at the time of the corona crash in March 2020:
“Current BTC Weekly RSI: 37
All bear bottoms: 29-35
March 2020 crash: 35
Closer to a bottom than a top in my opinion.”
Current #BTC weekly RSI: 37
All bear bottoms: 29-35
March 2020 crash: 35
Closer to a bottom than a top imo. GN all. pic.twitter.com/MzyLNnJ6IT
— TechDev (@TechDev_52) January 23, 2022
Bitcoin miners don’t capitulate (yet)
Then the bitcoin miners. In addition to the whales are they interesting bitcoin hodlers to keep an eye on. Miners receive bitcoins as a reward for their work and if they do not sell and hold these rewards, it could be a sign that they expect better bitcoin prices in the future. At the moment they are holding onto their bitcoins for the time being:
Miners are not selling #Bitcoin
Do they know something we don’t…? #BTC pic.twitter.com/csaE5y6hQJ
— Plan©️ (@TheRealPlanC) January 22, 2022
Unfortunately, this picture paints a slightly too positive picture. There is still the chance that the miners will still capitulate and dump their bitcoins en masse. Venture founder states in a tweet that the current bitcoin price particularly close to the production cost for miners. If we fall below, many miners could decide to sell with a possible further crash.
“The worst crashes Bitcoin has ever had were due to the capitulation of miners (December 2018, March 2020). When BTC falls below the cost of production, we run the risk of capitulation of miners.
BTC was at risk of miner capitulation at $30k in June and is now at risk again at $34k.”
The worst dumps #Bitcoin ever had were due to miners capitulation (Dec 2018, Mar 2020), when #BTC fell below production costs, it is at risk for miner capitulation.
BTC was at risk for #miner capitulation at $30k in June and at risk now again at $34k. pic.twitter.com/Ga9iWpeyMY
— venturefoundΞr (@venturefounder) January 22, 2022
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