After the Negative Difficulty Adjustment, there have been drops in the price of Bitcoin in the history of Bitcoin.
Before starting it took me all day to do this whole post, so give it a Like with your vote. Thank you.
Let's see
more data
source: https://btc.com/stats/diff
As we see in the chart, the generally negative adjustments in bitcoin's difficulty have caused a drop in bitcoin's price in the following days. Why? We must first see that the difficulty of Bitcoin
source: https://diff.cryptothis.com/
Bitcoin difficulty
Bitcoin’s difficulty is designed to adjust every 2016 blocks - or approximately every two weeks. This adjustment is based on changes in the network’s hashrate, and occurs regularly in an attempt to ensure that the network continues to solve new blocks at a rate of one every 10 minutes.
If the hashrate during the past two weeks has gone up, the difficulty will go up as well, making mining more challenging. If the hashrate has dropped, the difficulty level will decrease, making blocks easier to solve.
When there are significant negative changes in network difficulty, it indicates that the bearish cycle may be about to start
How does the bearish cycle occur as a result of a decrease in hash difficulty?
If the price of Bitcoin falls, mining costs may be negative, in the medium term they will have to stop mining or mine with losses.
Since the price of Bitcoin is lower, they will have to sell more Bitcoin because they have the same costs with a reward of mining a lower product for the lower price. This creates a downward pressure (plus the same supply demand) that can cause the price to fall again, generating a cycle. This generates mining capitulation
What are the costs of mining Bitcoin?
- Mining equipment,
- Infrastructure,
- Operating expenses,
- Electricity expenses
How do you get out of the cycle?
There comes a time when Bitcoin ends up selling or they are not willing to sell Bitcoin at such low prices or they are absorbed by investors who buy at low prices.
Graph Analysis
The graph has added the information of the relevant falls in the mining difficulty (blue lines) one by one, information provided by https://btc.com/stats/diff
As we see in subsequent days there have been price corrections (red arrows)
Current situation
As we see in the graph, the decrease in the hash is now at -4.5%, it should be greater than -6%, to be relevant, it could indicate the beginning of a bearish cycle due to the decrease in the hash.
Las correciones del precio no son inmediatas a veces se producen dias despues de una disminucion significativa del hash
What you think?
Remember to give your post a vote, Always support good content. Thanks
Follow me it costs you nothing and you get a Healing Reward with Your Vote
Leave your comment or your vote. Your opinion and participation is important
Protect your assets use Stop loss
The alcoins market is very dependent on the price of Bitcoin, when Bitcoins goes up the alcoins go up more, but also in the other sense, so I suggest that you periodically review a Bitcoin and use stop loss and move it when they are already in profit. Do not let a profit become a loss.
We will continue monitoring
To be attentive
Protect your Investments
If the analysis helped you, give your vote with some hive, thanks !!
Lately I have noticed that there is no good analysis on hive, everything takes time, I ask that as you read them leave your vote, it is a way to encourage you to continue making more reports, thanks.
Feel free to use and share my post or graphics, but please mention, as the author. Otherwise, consider plagiarism and I will call you and advise my friends to do the same.
READ DISCLAIMER: this publication / analysis is only for general information purposes. I am not a professional trader and I will never be a financial advisor. The material in this publication does not constitute any trading advice of any kind. This is the way I see the paintings and what my ideas are.
Perform your own analysis before making an investment decision. Use money that you are willing to lose if you make an investment.
If you make exchanges or investments after reading this publication, it is entirely at your own risk. I am not responsible for any of your gains or losses. By reading this publication, you acknowledge and agree that you will never hold me liable for any of your profits or losses.
For your vote or comment, thank you
Or else Buy me a beer ! Ligthing Network
Vote for the post.
Always support good content.
Follow me it costs you nothing and you get a Healing Reward with Your Vote