The price of Bitcoin is currently struggling to stay above water. At the time of writing, the flagship cryptocurrency trades at $19,108 and is trying to stay above $19,000 before yet another dip to the $18,200 zone.
In addition, the BTC network’s computational power has remained red-hot, as another all-time high hashrate was recorded this month. This high hashrate is the highest since the first quarter of 2020.
Bitcoin’s Hashrate Jumps
The blockchain’s hashrate measures how many mining calculations the network can perform in a single second. The higher the blockchain’s hashrate, the more computing power it has and the more resistant it is to attack.
By this metric, bitcoin’s hashrate appears to be soaring.
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According to a tweet posted by Mike McGlone, a senior commodity strategist at Bloomberg Intelligence, bitcoin’s current price difficulties with its hashrate high may signal that bitcoin is about to “return to its propensity to outperform other assets.”
McGlone also stated in the tweet that bitcoin’s ever-increasing hashrate concerning its current discount in price might make its risk-to-reward ratio favorable.
The commodity strategist also shared a chart illustrating the multi-year hashrate of bitcoin. According to the chart, McGlone explains that the 10-day average of bitcoin’s hashrate (and, therefore, its computing power) reached a new high in October.
This high, McGlone says, is “equivalent to the crypto price of around $70,000” from an autoscale perspective since 2015. He explains further that when bitcoin’s price was at $19,500 on October 18th, its discount to its relative hashrate was last seen when bitcoin’s closing low was at $5,000 in the first quarter of 2020.
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This pattern, says McGlone, is forming now.
At the time of writing, bitcoin’s hashrate is around the 257.6 Eh/s zone.
In a separate post on LinkedIn, McGlone has also stated that bitcoin’s price should “continue to rise over time” and that the cryptocurrency is now showing signs of a bottom around the fourth quarter of 2022.
Bitcoin Price Analysis
Bitcoin seems to be stuck in a sideways range as no movement in either direction appears to be happening.
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For weeks, Bitcoin has shuffled between the $18,200 support and the $20,000 resistance and has shown no signs of a strong bullish or bearish trend.
The price action of bitcoin is currently below the 100, 50, and 200 moving averages and may be a sign that the bulls may have a lot of work to do if the market is to move under the bullish influence.
On the RSI, the signal line is close to the neutral level, signaling that bitcoin may lack volatility and sufficient strength from either the bulls or the bears.
However, bitcoin continues to gravitate toward the $18,300 zone and may be in for a retest or a breakdown of this zone if the bulls fail to step up.
A break above the $20,000 zone may signal that the bulls are in control and will create enough bullish momentum to push the bitcoin price toward the $22,500 or even the $24,000 mark.
However, a break below the $18,000 zone may signal that the bears are in control and may cause a price dip to the $15,000 zone in further elongation of the current bear market.
Disclaimer: The author’s comments and recommendations are solely for educational and informative purposes. They do not represent any financial or investment advice. Always DYOR (do your own research)