In analysis provided by CryptoQuant, there has been a significant change in the behavior of Bitcoin miners, potentially indicating a turning point. The CryptoQuant analyst, known as Crypto Dan, outlined a reduction in selling pressure from miners, which has historically been a key factor influencing Bitcoin’s price trajectory.

Bitcoin Mining Sell Pressure Is Decreasing

According to Crypto Dan, “Miner selling pressure is decreasing. One of the whales that caused the cryptocurrency market to fall recently was miners. He explained that the BTC halving, which halved mining rewards, led to a decrease in the utilize of older, less competent mining rigs and, consequently, a reduction in overall mining activity. This change forced miners to sell Bitcoin in over-the-counter (OTC) transactions to sustain their operations.

The analysis suggests that the market is currently absorbing the sell-off, with a significant decline in the volume and frequency of Bitcoin transfers from miners’ wallets. “The current market can be seen as being in the process of digesting this sell-off, and fortunately the volume and number of Bitcoins miners are sending from their wallets has been declining rapidly in recent times,” Crypto Dan stated.

The consequences of this change are significant. Crypto Dan added: “In other words, miners’ selling pressure is fading, and if all of their selling volume is absorbed, a situation may arise where the bullish rally can continue again.” He projected optimism for the market, predicting positive moves in the third quarter of 2024.

Historical data from CryptoQuant confirms this analysis. BTC has previously shown a similar pattern, with mining sales having a forceful impact on market prices, particularly from May to September 2023 and from December 2023 to January 2024. During these periods, prolonged sideways movements in BTC prices were observed, coinciding with with peaks in miners’ sales. It is worth noting that as this selling activity subsided, Bitcoin prices returned to an upward trend.

This pattern suggests that the cryptocurrency’s recent decline in sales could be a precursor to another significant bull run for Bitcoin, as market conditions appear favorable for a similar trend change.

Key price level for a bullish breakout

Next observations from technical analysts at Alpha dōjō provide a detailed look at market conditions. Their daily updates on Bitcoin to X highlight the current indecision in the market, characterized by Bitcoin “jumping around” without a clear directional move. However, the analysts have identified critical price levels that could indicate future market moves: “If BTC reclaims the $63.5k area, it would be bullish; if it loses the $60k level, it would be bearish.

Technical analysis also reveals that liquidity in the Bitcoin market is currently scattered, with few significant clusters of orders. The most noticeable concentration of orders is approximately 63.5 thousand. USD, which suggests that this price point is key to market sentiment and potential upside momentum.

Order book data provided by alpha dōjō highlights the current dominance of sell orders, indicating bearish sentiment among traders. On the other hand, the bid side is described as feeble, with fewer buy orders supporting bullish price moves. This imbalance suggests the market is currently cautious, potentially waiting for more definitive signals before committing to larger positions.

At the time of going to press, BTC was trading at $61,704.

Featured image created with DALL E, chart from TradingView.com