Is the Low Bitcoin Hashprice a Sign of an Approaching Bottom?CryptoQuant analyst Woominkyu's latest analysis report suggests that a close correlation exists between Bitcoin hashprice and Bitcoin price. The current low hashprice could indicate that Bitcoin is nearing its bottom
Is the Low Bitcoin Hashprice a Sign of an Approaching Bottom?
CryptoQuant analyst Woominkyu's latest analysis report suggests that a close correlation exists between Bitcoin hashprice and Bitcoin price. The current low hashprice could indicate that Bitcoin is nearing its bottom. Woominkyu explains that hashprice reflects the profitability of miners. He demonstrates through charts how historically, when hashprice declined to lower levels (marked by blue boxes in the chart), it coincided with periods when Bitcoin price was at or near its lowest point.
This historical pattern indicates that hashprice troughs often align with Bitcoin price bottoms. In other words, when miner profitability decreases, causing hashprice to decline, it could suggest that Bitcoin price has already reached or is approaching its bottom.
It's important to note that hashprice is only one factor influencing Bitcoin price and not the sole determinant. Other factors such as macroeconomic environment, regulatory policies, market sentiment, etc., also impact Bitcoin price. Therefore, it's not advisable to solely rely on the low hashprice to conclude that Bitcoin price has already bottomed out.
However, the trend of hashprice can serve as a reference indicator, providing investors with certain insights. When hashprice remains low for an extended period, investors should exercise caution and invest cautiously, avoiding purchases near the market bottom.
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