BTC miners ‘finally capitulating’ — 5 things to know in Bitcoin this week

BTC miners ‘finally capitulating’ — 5 things to know in Bitcoin this week

by Ras Vasilisin
18. July 2022
BTC miners ‘finally capitulating’ — 5 things to know in Bitcoin this week

Bitcoin (BTC) starts a new week nearing key resistance as the shock of the latest United States inflation data passes — can the strength continue?

The July 17 weekly close may have been practically identical to the last, but BTC/USD is showing some much-needed strength prior to the July 18 Wall Street open.

Last week was a testing time for crypto hodlers everywhere, with inflation dictating the mood across risk assets and the U.S. dollar capping the gloomy atmosphere. With those pressures now easing — at least temporarily — the mood has room to relax.

At the same time, on-chain data suggests that now is a make-or-break moment for Bitcoin miners, and capitulation across the market feels close.

As talk over where Bitcoin’s macro bottom could lie continues, Cointelegraph takes a look at several factors primed to shape BTC price performance in the coming days.

All eyes on weekly moving averages

Those watching the weekly chart on BTC will have a sense of deja vu this time around — BTC/USD finished July 17 under $100 away from where it was on July 10.

The latest weekly close is something of a disappointment in and of itself, with Bitcoin erasing gains at the last minute to print a “red” candle for the past seven days.

What happened next, on the other hand, had the opposite tone — a swift overnight march higher, the largest cryptocurrency adding $1,400 in under twelve hours.

It all leads up to a familiar challenge on intraday timeframes — BTC/USD is approaching both $22,000 and a key trendline at $22,600 in the form of the 200-week moving average (WMA).

Previously acting as support in bear markets, the 200 WMA has, in fact, flipped to resistance this time around, having been lost in mid-June and never reclaimed.

As such, analysts are eyeing that level as a key area of interest should bulls be able to sustain upside pressure.

For PlanB, creator of the Stock-to-Flow family of BTC price models, a factor beyond spot price is meanwhile reinforcing its importance. As in previous bear markets, the 200 WMA briefly went above Bitcoin’s realized price this year, providing a classic market reversal signal.

Realized price refers to the average price at which all the Bitcoin in existence last moved.

“In the bear market of 2014/15 and 2018/19 (blue) realized price was above 200WMA and the bull market did not start until realized price and 200WMA touched,” PlanB told Twitter followers on July 17 alongside an accompanying chart:

“Now realized price and 200WMA already touched at $22K. For the next bull market we need BTC above realized price and 200WMA.”

As Cointelegraph reported, bulls seem to need to play a game of moving averages on longer timeframes, too. In addition to the 200 WMA, the 50-week and 100-week exponential moving averages (EMAs) also figure in forecasts.

The 50 EMA currently sits at $36,000 and the 100 EMA at just above $34,300, data from Cointelegraph Markets Pro and TradingView shows.

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