On-chain data shows that the Bitcoin Hash Ribbon gold cross has not increased its price for the first time.
Bitcoin Hash Ribbons have recently formed a Death Cross
As noted by an analyst in a CryptoQuant afterthe BTC Hash Ribbon model has failed for the first time in cryptocurrency history.
The relevant indicator here is the “mining hash rate”, which measures the total amount of computing power currently connected to the Bitcoin network.
When the value of this metric rises, it means that miners are currently bringing more mining rigs online. On the other hand, a decline suggests that these chain validators are leaving the network and disconnecting their machines.
The Hash Ribbon is a BTC model based on two moving averages of the hashrate metric. A “Moving Average”(MA) is the average value of any quantity which, as the name implies, moves with the metric and changes its value accordingly.
The advantage of an MA is that it flattens the curve and removes any temporary fluctuations that do not affect the long-term trend.
In the context of the Hash Ribbon model, the Bitcoin hashrate MAs of interest are the 30-day and the 60-day versions. Here is a chart showing the trend in these two ribbons over the past few years:
Looks like the two MAs of the metric have gone through a cross recently | Source: CryptoQuant
As you can see in the chart above, the Bitcoin 60-day MA hashrate recently passed the 30-day mark.
When this kind of crossover happens, it means that the hashrate has dropped a lot recently, as the 30-day average has dropped below the longer, 60-day average.
Historically, crosses like this are bearish death crosses for the price, as they are a signal of miner capitulation.
Crosses of the opposite kind, on the other hand, have always had a bullish effect on the price of the coin as they indicate that miners are optimistic about the outcome of BTC as they expand their operations.
However, the last gold cross took place a few months ago, but instead of an increase in price, a decrease has followed. Since the death cross is already in, it seems that this bullish crossover has not paid off for the first time in Bitcoin history.
BTC price
At the moment of writing, The price of Bitcoin floating around $17.3k, up 7% over the past week.
BTC seems to have shot up | Source: BTCUSD on TradingView
Featured image from mana5280 on Unsplash.com, charts from TradingView.com, CryptoQuant.com