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5 things you should know about the current Bitcoin price

May 25, 2020

Bitcoin (BTC) is facing a difficult week Support at $ 9,000 is dwindling and uncertainty is increasing after halving.

Cointelegraph’s weekly review takes a look at it Five factors that are likely to affect Bitcoin price developments in the short term.

BTC price pressure on miners’ fuel outflows

The weekend was another decline for BTC / USD as Bears drove the price the coin under $ 9,000.

5 things you should know about the current Bitcoin price5 things you should know about the current Bitcoin price

A few difficult days followed in the past week, in which the sales of the miners increased dramatically.

As Cointelegraph reported The miners sold more than they deserved, despite the fact that his income was already 50% lower due to the halving two weeks ago.

Bitcoin mining pool expires 1-year chart

Bitcoin mining group annual flowchart. Source: CryptoQuant

If this practice continues, the pressure on the price will increasethat has already been rejected for just under $ 10,000.

Lower support levels in the $ 8,000 range may be Bitcoin’s only firm hope of a recovery if the losses continue. The 200-day moving average is currently exactly $ 8,000.

The new futures gap of over $ 9,000

The volatility since Friday opened a modest gap in the CME Group’s bitcoin futures markets. These “gaps” arise when one trading week ends at a different time from the next, and are later closed by the markets.

This time the gap is between USD 9,065 and USD 9,180. Bitcoin would have to hit the $ 9,000 mark to fill it, but this behavior is common enough to remain possible even under bearish pressure.

Sometimes BTC / USD rises or falls to close a gapbefore you immediately return to your previous position.

Bitcoin futures chart with the latest gap

Bitcoin futures chart with the last gap. Source: TradingView

Difficulty adjustments could mimic 2018

However, The basics of Bitcoin combine mining data to make a poorer forecast for the market mood.

The difficulty of the network, a measure of the effort required to mine the Bitcoin blockchain, currently these on the next adjustment in ten days decreased by 6.3%.

The previous adjustment four days ago was 6%A downward change next time would result in the first consecutive decline since Bitcoin’s price decline in December 2018.

Far from being a bad sign Reducing the difficulty is one of the most important self-stabilizing functions of Bitcoin. The miners’ playground encourages more activity, which in turn increases safety and profitability.

Bitcoin 7-day average hash rate 2-month chart

Graph of the average bitcoin hash rate in 2 months. Source: Blockchain

Meanwhile, the network hash rate, a rough interpretation of the computing power for Bitcoin mining, stabilizes at around 95 trillion hashes per secondbelow historical highs of around 140 trillion.

Shares rise in the shadow of big shorts

In traditional marketsOn the other hand, too There are new bear signals.

Especially this week The alarmingly short position in the S P 500 makes headlines, which is currently closing its own 200-day moving average from below.

“This level is definitely worth seeing,” James McCormick, senior strategist at NatWest Markets, told Bloomberg.

McCormick referred to an internal signal that is now in its “biggest decline” since 2016.

Mostly, The markets trended higher on Monday and the European markets followed the behavior of the US futures. at the opening. As Cointelegraph noted, Bitcoin has increasingly ignored traditional market activity in recent weeks, a process commonly known as “decoupling”.

Fear and greed

A reassuring result of last week’s downtrend was at least one softening of the Fear and Greed Index.

Crypto Fear  Greed Index 1-month chart

1-month chart of the Fear and Greed Index. Source: Alternative.me

Designed to measure the rationality of market sentiment, the 1-100 reading triggers the alarm, either “greed” or “extreme greed” when the readings are close to 60 or higher.

On Monday, the index fell to 41, a “scary” reading.;; in May it reached 56.