It is time for another portion of hopium. Because according to two indicators the Bitcoin (BTC) price is fine. What’s more: if history repeats itself, there will be a sharp rise on the horizon.
Difficulty Ribbon indicator
On 28 September, market researcher Glassnode shares an important indicator: Bitcoin’s difficulty ribbon compression has broken out into a ‚buy signal‘.
This indicator tells something about: the difficulty of minus, but also whether or not miners struggle to be profitable.
The graph below shows the following:
- black line: the price of Bitcoin;
- orange line: the Difficulty Ribbon Compression;
- green areas: moments when the indicator is below 0.05.
The orange line is a compression of multiple averages. The lower this number, the closer these averages are to each other and the clearer the trend reversal is.
As can be seen in the graph, the indicator is above this 0.05. What does that say exactly?
The difficulty ribbon compression is based on the difficulty of mining and its relationship to the Bitcoin Revival price. The metric was invented by statistician Willy Woo. He uses moving averages of the values of mining difficulty.
If these different averages are close to each other, it means that a change is imminent.
It shows that miners do not necessarily have to sell compared to previous periods. If they don’t sell their bitcoin, the price may recover and possibly rise.
„The Difficulty Ribbon Compression is in an upward trend and has broken out of the green ‚buy‘ zone. This is the first time since March.“
GLASSNODE ON TWITTER
It therefore looks suspiciously like a new trend is emerging, which may well turn out well for the Bitcoin price.
The indicator is not to be confused with the Hash Ribbons, invented by Charles Edwards. Although the hashrate is not separate from the difficulty rate.
On Twitter earlier this month, he showed that this indicator is back on green for the first time in a long time. That score says something about the mineral capitulation yields. In other words, miners accumulate their Bitcoin more than they sell it.
And that is now good news a few months after the block subsidy was halved.
Another graph that gets a lot of attention on Twitter is also about recurring cycles. If Bitcoin’s history tells you something about cycles from lows to highs, it looks good too.
The chart below shows that a rise in the BTC price is not inconceivable.
If history repeats itself, the price could go through $300,000 by the end of next year, writes Bitcoin Jack.