Bitcoin Price Analysis: Bitmain’s new investment to secure long-term growth of Bitcoin price
Last week we predicted that Bitcoin’s price would fluctuate between US$10,000-$11,000 based on fundamental analysis. Our prediction stood largely correct as the price of Bitcoin last week held US$10,000 and bounced to US$10,600. Currently Bitcoin price fluctuates around US$10,300. This week, we continue to delve into the fundamental analysis to help understand market trends.
Daily trading volumes
The daily trading volume continues to decline but it is still above the record low. The latest figure is 289,000 and we will keep monitoring the index to see if it stabilizes. The daily trading volume has been on a slow increase since February 2018. It shows the core value of Bitcoin and is the fundamental support for Bitcoin price. For now the number is not looking optimistic but we don’t need to be too pessimistic about it either.
Daily average hashrate
The hashrate for Bitcoin has gone back to the height of 80EH/s, indicating that miners are working diligently to process more blocks and meet the upcoming influx in transactions. It also shows that Bitcoin is more secure than ever. Computing power (aka mining hashrate) is a key market metric as it illustrates the networks transactional demand. The hashrate for Bitcoin has been on a steady rise since last year, which sets the cornerstone for the long-term growth of Bitcoin.
According to news reports, Bitcoin mining giant Bitmain will buy 600,000 mining chips from Taiwan Semiconductor Manufacturing Company, increasing its network computing power by 50% in the next six months. With new investment from mining operators, the rise of Bitcoin price is a certainty.
Active & New Addresses:
Active Addresses refer to the number of unique “from” or “to” addresses used per day. New Addresses refer to the number of addresses used for first-time transaction per day. The two figures remained in decline last week.
Addresses containing a small amount of BTC
The indication refers to the number of addresses that contain 0.1 to 1 Bitcoin. Currently, there are 2,024,000 addresses that contain such an amount of Bitcoin. The rapid increase in this indicator is one of the criteria for determining the existence and length of a bull trend.
USDT continued to decrease last week, with the latest rate at 0.8%. The current fund in the field is not enough to support the momentum of the price of Bitcoin to increase drastically.
Google Search Trend
Last week there was no visible change in Google Search trend for “Bitcoin”, which indicates that public enthusiasm towards Bitcoin remained low.
Fear & Greed Index (FGI)
We started to include FGI in our analysis of Bitcoin market trend last week. FGI has returned to 41, which means that the fear sentiment in the market has relieved. The darkest moment for the market has passed.
Looking towards next week
Overall we continued to see a decline in fundamental statistics last week and the prospect of an increase in Bitcoin price remained low. Based on these numbers, we predict that Bitcoin price will continue to fluctuate within the symmetric triangle. However, in the past month, the key price support for Bitcoin has gone from US$9000 to US$9500 and then risen to the $10,000 area. The key price support has been increasing, suggesting that the market has taken a turn for the better.
According to CoinMetrics’s latest statistics, the realized market cap of Bitcoin is now at record high, surpassing US$100 billion. Realized market cap is an alternative calculation of Bitcoin’s market capitalization. Instead of calculating the market value of all Bitcoin which might include the 15% to 20% Bitcoin that might have been germanely lost, realized market cap is calculated from multiplying the price each bitcoin last traded by the size of each trade. The achievement is just one more indicator that Bitcoin price will reach a record high in the long-term. All we need to do is be patient and have faith.
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