The markets are heading towards the end of the first half of the year and hence, significant volatility is expected. With the latest price action, the bears have demonstrated huge dominance as the Bitcoin price slipped below the major support. On the other hand, the traders and institutions do not appear to be optimistic, while the whales are preparing for the upcoming bull run, which is yet to begin.
The main concern among the market participants is that the BTC price is not triggering a strong recovery. After a massive pullback, the bulls usually jump in to accumulate the token at a discounted price, which initiates a strong and quick recovery. This time, a drop in the trader’s confidence and bullish interference are witnessed, due to which the pace of the rally has slumped to a large extent.
A popular analyst, otherwise known as Willy Woo, shares an interesting reason as to why the BTC price is not recovering after a correction.
It has been more than 100 days since the BTC price has been consolidating within a predetermined range. The analyst believes the miner’s behaviour has highly influenced the rally as ‘weak miners’ have not died, which has prevented the hate rate from recovering. Here, the analyst refers to those miners as ‘weak’ who are inefficient in handling the mining cost after their income has halved after Bitcoin halving.
As a result, miners are compelled to sell their BTC to pay for losses or hardware upgrades. This creates massive selling pressure, which ends when all these miners liquidate and only their strong hands continue to hold. During the previous 2 halvings in 2016 & 2020, the hash rate recovered after 24 & 8 days, respectively. Meanwhile, the hash rate is still struggling, even after 62 days of halving at the moment.
The hash rate has maintained a strong, elevated trend ever since the price rebounded in the last few weeks of 2023 and marked highs at 717B TH/s. The levels have plunged significantly and are failing to recover. Therefore, the analysts believe the hash rate is expected to recover only when all these weak miners ‘die’, which may initiate a strong recovery in Bitcoin (BTC) prices. Until then, the consultation phase may continue for an unspecified period.
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