Bitcoin (BTC) returned to local highs at the open on Wall Street on Oct. 25 as nervous analysts kept an eye on miners.
DXY provides instant relief for BTC
Data from Cointelegraph Markets Pro and TradingView showed the BTC/USD pair rising to offer a modest challenge to resistance, still unable to break out of an established trading range.
US stocks also rose slightly, with the S&P 500 and the Nasdaq Composite Index up 1% and 1.3%, respectively.at the time of writing this report.
On the contrary, The US Dollar Index (DXY) lost ground on the day, falling to its lowest levels since Oct 6 and providing potential tailwinds for risk assets to seal opportunistic gains.
For traders, the intraday status quo remained amid a continued lack of real volatility. The popular Twitter account Crypto Tony highlighted significant range levels, with $18,900 an important zone to hold.
His Crypto colleague Ed, meanwhile, revealed that he is “still expecting” a correction to that level, followed by a bounce back past $19,100.
“It might even go down a bit more, and if it comes back here, it would be the ticket for a long deal,” he said in a YouTube update.
Previously, commentators had revealed a wait-and-see approach to the market, with estimates of a breakout ranging from two to eight weeks.
miners under surveillance
Downside risk, meanwhile, was firmly focused on miners on the day.
With the hash rate at all-time highs but the spot price at its lowest point in almost two years, miners are still battling the biggest profit squeeze in history. Some warn that they could soon be forced to sell the accumulated coins to break even.
In a research article devoted to the topic, Caue Oliveira, a principal analyst at the BlockTrends chain, drew particular attention to the price of the hash, that is, the miners’ income for each exahash.
“Right now the hashprice, as the indicator is known, hit $66,500, which is the lowest value ever recorded,” he explained.
“Total revenue has deviated sharply from its average annual growth. What is common to all bass players but with a difference: the maintenance costs of the operation”.
In September, public miners’ BTC balance totaled 34,509 BTC, a large tranche of liquidity that “may be unloaded as mining pressure continues”, commented market analyst Sam Rule.
“Bitcoin could capitulate to the $10,000-$18,000 range, fueled by a final miner sell-off. Something I definitely psychologically prepare for,” added veteran analyst Tuur Demeester.
However, with the miners exiting a major capitulation phase in August, the data suggests that even prolonged distribution of coins does not necessarily have a negative impact on price action.
In early 2021, for example, After the BTC/USD pair hit its 2017 all-time high, miners embarked on a massive profit-taking exercise, which failed to slow down Bitcoin when it hit an impulsive high of $58,000 in April of that year.
According to on-chain analytics firm Glassnode, the sale at the time caused some 30,000 BTC to leave miners’ wallets in the month of January.
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