The post Crypto Market Analysis: Top 5 Crucial Bitcoin Signals to Keep an Eye On appeared first on Coinpedia Fintech News
Bitcoin is experiencing a remarkable recovery, with its value increasing by 29% since July 5, reaching a peak of $68,000. This sudden surge is generating enthusiasm among investors. Crypto analyst Willy Woo highlights key macro signals that could drive the bullish run for Bitcoin. Here’s a breakdown of what to watch for and why these signals matter.
Miners’ Capitulation & Hash Rate Recovery
One of Woo’s major indicators is the end of miner capitulation, a phase when miners face significant financial strain. According to Woo, this period is now over. He notes that the hash rate, which measures the total computing power of the Bitcoin network, is recovering.
Along with the introduction of next-generation mining hardware, such as the M66s and S21 Pros, is expected to boost the hash rate further, signaling a potential bullish trend.
Woo notes that miner capitulation is a reliable bullish indicator. The recent recovery in hash rate often leads to a corresponding rise in Bitcoin’s price, which Woo predicts will follow. Historically, such recoveries have been followed by extended periods of bullishness.
Role of the Puell Multiple
Another important metric Woo is watching is the Puell Multiple, which compares miners’ current profitability to their past revenues. This indicator has two key phases:
Macro Bottoms: Occur when miner profitability is at its lowest, indicating a potential reversal.
Signal Bottom: This happens when Bitcoin’s halving event reduces miner earnings by half, setting the stage for a bull run.
Woo points out that we are currently in the second phase. With miner earnings significantly reduced, the market is poised for a possible bullish shift, making it an opportune time to invest in mining stocks.
Global Liquidity On The Rise
On a broader scale, Woo highlights the importance of global liquidity. Traditionally, when liquidity expands often through increased money printing investors turn to risk-on assets like Bitcoin. However, early signs suggest that global liquidity may be on the rise, further supporting a bullish outlook for Bitcoin.
Potential Bearish Factors
Despite these positive signals, Woo also notes some bearish factors. One concern is the recent buildup of Bitcoin entering spot exchanges, including a significant 42,587 BTC transfer from Mt. Gox to new wallets. This influx could impact market dynamics.
Additionally, the upcoming launch of the Ethereum spot ETF might lead to some capital rotating out of Bitcoin and into Ethereum, which could also affect Bitcoin’s price.
What Next For Bitcoin?
Looking ahead, Woo believes Bitcoin needs to break the $73,000 mark to trigger a short squeeze, potentially driving the price up to $77,000. Beyond this level, Bitcoin could enter a phase of price discovery with fewer obstacles.
As of now, bitcoin is trading at $66,613 reflecting a drop of 1% seen in the last 24 hours. Despite the drop BTC trading volume has seen a surge of 47% with a market cap of $1.31 trillion.
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