Bitcoin dumps 6%, but long term indicator flashes ‘buy’ signal

Bitcoin dumps 6%, but long term indicator flashes ‘buy’ signal

Bitcoin and its crypto brethren have taken another slide today as digital assets dump previous gains. Longer-term signals are positive for a post-halving rally which could materialize soon if history rhymes.

Bitcoin has again failed to break resistance in the mid-$9,000 zone and dumped almost six percent, falling back to US$9,100 [AU$13,260], according to TradingView.

The king of crypto has returned to a ten-day low and is in danger of dropping below $9,000 if the selloff continues.

There is little to be concerned about at the moment however as BTC remains in its range-bound channel that has played out since the beginning of May. Further losses, however, could see a plunge back to support in the mid-$8,000 range.

Market analyst Lark Davis has been observing long term signals called “hash ribbons.” These indicators use a one-and-two month simple moving average (SMA) of Bitcoin’s hash rate to identify market bottoms, miner capitulation, and optimal times to buy BTC.

“The bitcoin hash ribbons are about to flash the buy signal.”

The analyst goes on to highlight previous rallies after the first two halvings. The first was 4500% with prices topping out at $1,200, while the second rally was a little smaller at 2700% hitting a price peak of $20,000.

If history rhymes a 1,600% rally from current levels could put BTC price at $160,000 in the next couple of years.

Looking at the charts today though, and it all seems like wishful thinking.

Featured image courtesy of Nick Chong/Unsplash

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