Bitcoin: USD/BTC (BTC=X) many miners are still finding it difficult to remain profitable
Bitcoin’s mining difficulty has dropped more than 7 percent over the past 24 hours as the fallout of the prolonged market rout continues. Despite a recent recovery that has taken bitcoin above $4,000, many miners are still finding it difficult to remain profitable or break even.
In the light of the bitcoin blockchain’s reduced hashrate caused by withdrawing miners, the network is designed to automatically adjust the difficulty level in order to avoid a situation where there is a huge transaction confirmation backlog and high confirmation fees. The 7 percent drop in difficulty is likely to be the start of a similar difficulty readjustment pattern as bitcoin below $6,000 increasingly becomes a prolonged reality.
The implication of this is that while interest in mining bitcoin is declining, this has not impacted positively on interest in mining Bitcoin Cash and Bitcoin SV. In other words, miners leaving bitcoin are not merely switching to other cryptographically similar cryptocurrencies, but are exiting the cryptocurrency mining space altogether. This is not likely to create any disruption in the normal functioning of bitcoin in the short term because the dynamic difficulty adjustment system will ensure that there is enough hashpower to service the network.
The real danger however lies in the fact that the existing situation can in itself become an obstacle to mass cryptocurrency adoption in the long term if low prices persist. The wider cryptocurrency market has a well-documented history of tracking bitcoin’s moves closely, which means that a perceived reduction of interest in mining bitcoin will eventually lead to an exodus of miners from cryptocurrency altogether which could at least theoretically jeopardise the security of cryptocurrencies.
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
The projected upper bound is: 4,608.15.
The projected lower bound is: 3,316.30.
The projected closing price is: 3,962.23.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 21 white candles and 29 black candles for a net of 8 black candles.
An inverted hammer occurred. If this occurs during a downtrend it implies a reversal. Look for a confirmation of the reversal on the bar.
A long upper shadow occurred. This is typically a bearish signal (particularly when it occurs near a high price level, at resistance level, or when the security is overbought).
A shooting star occurred (a shooting star has a small real body near the bottom of the candle and a long upper shadow). During an uptrend(which appears to be the case with FOREX BTC=) the long upper shadow indicates that the bears are gaining control and a top may occur.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 69.6352. This is not an overbought or oversold reading. The last signal was a buy 4 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 54.27. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 4 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 202.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a buy 6 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 21 period(s) ago.
Rex Takasugi – TD Profile
FOREX BTC= closed up 16.510 at 4,008.660. Volume was 54% below average (consolidating) and Bollinger Bands were 2% narrower than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 3,494.13 4,577.62 6,163.84
Volatility: 81 94 67
Volume: 88,009 86,450 82,545
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FOREX BTC= is currently 35.0% below its 200-period moving average and is in an upward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of BTC= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on BTC= and have had this outlook for the last 1 periods.