BTC vs stock and investing in difficult timesDifficult times are coming
Since march 2020 when pandemic was accounced we saw many bad for economy decisions. There was no doubt that it will have negative impact. At the beginning bad sentiments were "flooded" with printed money as per tradingeconomics we can see money supply in the US increased 4 times between march and april 2020. Until now we can see effects in very high inflation in Europe and both Americas. South America however always had this problem :)
The war in the Ukraine will have negative impact for wheat supply to many countries in the Middle East and Africa. Other countries to save wheat supply for themselves will ban export. Ban on the Russian oil will increase prices in Europe even more. Probably in some countries we will see fire on the streets in the next year.
When LUNA crashed many people lost 100% of their savings because some invested 100% in one asset.
High inflation is pushing people to bad economical decisions. Some people invest in gold, other in BTC or real estate to save money from inflation. This is however creating the bubble. Many people bought houses in the past 2 years because of very cheap loans (0.05 interest rates). With higher interest rates they will be not able to pay loan, many houses will be sold unfinished.
In the difficult times the winners will be the people who wait with investment for right moment. In next years we will see a lot of bankruptcy.
Watch interest rates in the next months. Expected are further rises in many countries. War in the Ukraine and oil prices have significant role too.
Difficulty
Bitcoin: Bullish but No Rush Hi, everyone. We are back! Sorry for the long absence. We’ve spent the past few months developing some awesome on-chain indicators, which will be released soon. :)
For BTC, we are currently at a crucial state, with many attempts at the 10k mark. All fundamentals considered, we do believe it is only a matter of time for the break to the upside. However, looking at miner behavior, we do think the consolidation would still need some time to play out. Historically, it has always been good accumulation opportunities after the weak miners’ sell off and capitulation. With only strong miners left, the miner selling pressure decreases. Recent data also shows a significant decrease in miners transferring BTC to exchange wallets after the halving, confirming the increasing miners’ short-term holding behavior.
How do miners react in large price drops / halving events?
--> Price drop / halving
--> Miner revenue decrease
--> Weak miners: sell more to maintain operational
--> Strong miners: holding and use existing cash for operational cost
--> Weak miners: not sustainable & capitulate
--> Only strong miners left (holding, not selling) --> mkt supply decrease
--> Price stabilize --> then rise
*credit to capriole_charles for the hash ribbon indicator.
Hash Rates Trump Difficulty in Identifying Miner CapitulationA visualization of Bitcoin Hash Rate vs Difficulty.
This helps to show why Difficulty is a lagging indicator.
Difficulty is like a moving average that only updates once every 2 weeks.
Increased Difficulty is not necessarily good... Hash Rates are better for timing capitulation.
Difficulty Ribbon - A New Blockchain Based Bitcoin IndicatorIntro
Introducing the Bitcoin Difficulty Ribbon. When the ribbon compresses, or flips negative, these are the best times to buy Bitcoin. The ribbon consists of simple moving averages on mining difficulty so we can easily see the rate of change in difficulty.
Attribution
This Indicator was created by Willy Woo of Woonomics based upon the ideas of Vinny Lingham.
An in depth article can be found here regarding the difficulty ribbon: woobull.com
Extras
We added some Moving Average options to choose from if you want to experiment.
We also added background coloration signals. Yellow is the beginning of compression, and green is the fully compressed or inverted signal.
Use these signals as an added confirmation signal alongside other blockchain based FA or long term TA indicators.
Instructions to add to the chart correctly
1.Add Indicator, and it will appear below price chart.
2.Click on the ribbon line and drag it up onto the price chart. (gives you separate scales)
3.Set both price and difficulty ribbon scale to logarithmic (right click on scale)
Cryptorhythms
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