Miners are still accumulating BTC so far, but depressed prices continuing may upend the status quo this summer, new analysis says.
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Bitcoin (BTC) fell in line with United States equities on May 31 as the return of Wall Street began with a whimper.
Stocks take BTC price south again
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD returning to near $31,000 at the start of trading after markets returned from a public holiday.
The move reflected those of stocks indices, with the S&P 500 losing 1.1% at the open and the Nasdaq Composite Index trading down 1%.
With volatility in evidence, preexisting suspicions over the staying power of Bitcoin’s recent rise remained vocal among social media commentators.
I still think the rise in #BTC price is fake. It is clear that we do not know how high it will rise. But I have no doubt that it is pumped…
We can see a very negative delta on the daily time frame as well as imbalances in favor of sellers in the aggressive seller zone… pic.twitter.com/kcvffm9IFj
— M_Ernest_₿ (@M_Ernest_) May 31, 2022
“It is not unlikely that equities will give away some of their gains from last week,” analyst Jan Wuesterfeld wrote in the latest edition of his Bitcoin Market Intelligence newsletter on the day.
“In my mind, if that happens, bitcoin will probably also give away some of the gains made over the weekend and on Monday (reconnection in this case).”
Others focused on uninspiring long-term price signals. Kevin Svenson, a contributing analyst to on-chain analytics platform CryptoQuant, highlighted Bitcoin’s 20-month exponential moving average (EMA) as a source of possible future contention.
“In previous cycles, Bitcoin spent 6 -> 13 months below the 20m/EMA after breaking down below it. We currently just experienced our first month below the 20m/EMA,” he explained.
“If human emotion repeats, then we will be below the 20m/EMA until (at least) November 2022 … and 13m’s is May 2023.”
“No trend” of distribution by miners
A potential silver lining for Bitcoin came in the form of miner behavior.
Related: ‘Mega bullish signal’ or ‘real breakdown?’ 5 things to know in Bitcoin this week
Amid warnings that miners’ cost price is now above spot, creating the threat of capitulation similar to the bottom of the 2018 bear market, data suggested that panic had not yet set in.
“Bitcoin miners are regarded as smart money and speculators in the BTC markets,” fellow CryptoQuant contributor and analyst Venturefounder wrote in a bulletin on the day.
“As BTC price recovers, Bitcoin miners have not shown any trend of net distribution, in fact, the net accumulation trend which started in July 2021 continues.”
An accompanying chart showed that miners had increased their BTC reserves in the second half of May, in particular.
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