Topic: [Charts] Hash Ribbons Buy Signals 2016-2020 Extrapolation [New Signal Incoming] (Read 341 times)

Likewise, I compare current prices to around late 2016 $1K, prior to breaking ATH, for obvious reasons. From 2019 & 2020 data however, if you look closer you'll notice that the March miner capitulation rallied the price, the post-havling capitulation caused sideways trading more than anything (from capitulation to recovery at least) and December 2019 was the only time when the price dumped.


Given the three past capitulations price respectively dropped, pumped and went sideways, there isn't much relevance there. However each time price more or less consolidated once the miner recovery began, this is the part I'm paying attention to. Potentially, the slower the miner recovery, the longer the consolidation takes, given the accuracy of the buy signals.

On a side-note, in late 2016 we never had miner capitulation until the 2018 $6K to $3K dump after the post halving capitulation. This doesn't worry me as such, as should only indicate healthy consolidation at worst, but it does make me wonder why this capitulation is happening (while price is rising). In March it was obvious, it was because price had already dumped.



This time it's very different, I have no idea why...

I like the type of analysis you do there, the model is very similar to the S2F, however PlanB has its different ways of explaining it and has some details, but the trend shown is seen to be in the medium-long term, something favorable Due to world events and if we add that Paypal bought 70% of the recently mined bitcoins it is a good plus for the market in general.

Interested to see how it plays out.

Structurally, I think we're somewhere similar to late 2016 so I wonder how good this data set is, in a predictive sense. In those previous examples (2019 and earlier 2020) a hash rate drop predictably followed a downside price correction. In the latest example, the hash rate dropped during a monumental increase in price.

Interesting contrast, don't you think? What do you make of it, and do you think that changes things?

Consolidation period incoming? While the miner capitulation had zero effect on price, the recovery in hash rate may still have some influence it seems. This would be a rough estimate of the price consolidation during the "miner recovery" stage, when hash rate increases, before MA crossover provides the buy signal.

On the Daily time-frame, the hash ribbons indicator is signalling the beginning a recovery. While still some way away from a buy signal, it's a promising sign:



It will be interesting to see how hash rate reacts if the price corrects lower, as hash rate could drop further as a result, but otherwise with price remaining bullish it seems likely the hash rate will continue to recover providing a buy signal at some point in the near future.

As an update to this thread, to avoid another, this is how the hash ribbons are currently looking on the Daily chart:



Personally I'm not expecting further capitulation, such as prior and after the halving, more a quick dip before more miners switch back on again.

On Weekly view it already looks like it might be losing downwards momentum:



Most recent buy signals were:
April 2020: $7,552
July 2020: $9,303
November/December 2020: ?

Buy signal confirmed on Weekly chart!



The signal confirmed on yesterdays closing candle:



Hash rate 7 day MA at new ATH 

The Monthly close is in confluence with the Daily & Weekly confirming the hash rate recovery (bullish MA crossover of 30 and 60), as expected:

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It's true, while the hash rate recovery is promising, without the buy signal it's not confirmation of continued uptrend (or a "dip to buy" unquestionably) . Don't listen to any youtubers claiming the signal could be "broken" or there's a "bug". It's the uptrend in price that confirms the buy signal - once price is gaining momentum, after hash rate has recovered. As referenced, it could take upto 4 weeks or longer to get this buy signal, as was the case in 2015. There is nothing abnormal about this hash rate recovery, yet.

I'm admittedly not sure of the exact conditions of "positive price action" for this indicator to signal a buy, but I suspect it's a close above the hash recovery price (that was $9,243) or potentially the open at $9,690, or somewhere inbetween. While on shorter time-frames such as the 4hr and Daily, I'm still expecting a bear trap and a re-test of the lows (maybe lower lows), but once price can break through the resistance level of around $9.7K, we could swiftly move higher based on network strength.

Also bare in mind the max downdraw could still be considerable after a buy signal, even if short lived:



You can also add -47% to the downdraw from the December 2019 buy signal...dyor.
Current drawdown so far is only -5%, average is higher than -11% (inc. recent signals).

The first example after the 2018 crash gives me pause. It suggests the potential for a longer accumulation range, testing lower supports. If it plays out like that signal, then we would see a significant pullback from here.

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