Bitcoin trending down
After another week of turbulent market volatility, the cryptocurrency market saw steep declines with Bitcoin (BTC) and its peers dropping by nearly 25% from recent highs. This sale caught many speculators and traders off guard causing panic in the market.
The data Crypto Fear and Greed Index went from a weekly high of 94 back to a more modest 55. However, analysts reiterated that minor fixes are both necessary and organic, as Bitcoin seeks to consolidate around its data technical support levels.
Analysis of miners Change of net position
For the first time since the end of December of theLast year, the net change in Bitcoin miners' position turned positive again. Some analysts saw this renewed buildup by miners as a bullish indicator, citing that recent selling pressure may ease. Still, it's unclear whether the drop in mining pool sales will have a noticeable impact on the price of Bitcoin.
Historically, there has been little correlation between the Bitcoin price and the behavior of miners. Research from Clain , a crypto analysis company, confirms this claim. 'there was no proven statistical significance between the price action and the volume of Bitcoin miners sold on the exchanges - at least until 2019.
It's certainly possible that this net positive the positions are a sign that miners view Bitcoin's current price levels as undervalued. With more companies like Tesla, Square and MicroStrategy adding Bitcoin to their balance sheets, the prospects for future growth of the cryptocurrency space and mainstream adoption seem almost set in stone.
However, based on historical data andFrom previous research, it would be a mistake to suggest that the sudden build-up by the miners directly serve as a catalyst for another breakout rally.
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