Bitcoin may be approaching a local bottom: over recent months, the price has fallen more than 35% from its record high near $126,200. Taken together — technical, on-chain, and macro signals — selling pressure appears to be weakening, and a market recovery could begin within the next 4–6 weeks. Below are the main signs why this could be the bottom, along with straightforward recommendations for miners on operational decisions.
Signs of Weakening Selling Pressure
Several independent signals collectively paint a picture of gradually easing market pressure. The combination of a deep price drop, momentum reversal, and improving liquidity resembles a typical set of indicators preceding a local minimum.
- Bitcoin may form a local bottom after falling more than 35% from its record high near $126,200.
- Technical and on-chain indicators show momentum stabilization and weakening seller dominance.
- Macroeconomic liquidity conditions suggest a possible recovery within 4–6 weeks.
Signals from Technical Indicators
The weekly Stochastic RSI reversed upward in December from oversold levels, which typically precedes a momentum shift favoring buyers. Such momentum reversals often occur before the price begins a sustained rise and indicate that selling pressure is easing; details on the weekly indicator’s movement can be found in the article about weekly RSI. Additionally, on shorter timeframes, a bullish divergence is observed where price makes lower lows but momentum does not, also signaling a potential reversal.
These signs do not guarantee an immediate price increase but show that the main selling force may be diminishing. Similar patterns in the past appeared before longer recovery phases.
Miner Capitulation as a Bottom Signal
In the month leading up to December 15, the network hashrate dropped by 4%, seen as a sign of miner capitulation and temporary withdrawal of some mining power from the market. Historically, periods of hashrate decline often preceded strong recovery phases, and since 2014, after 30-day hashrate drops, 65% of cases recorded positive returns over the following 90 days.
A hashrate decline can ease profitability recovery for remaining miners and later bring offline capacity back online if prices and profitability improve.
Impact of Macroeconomic Conditions
The National Financial Conditions Index (NFCI) stood at -0.52 in December and was trending downward, typically reflecting improved liquidity in the financial system. Historically, NFCI easing has sometimes preceded Bitcoin rallies by several weeks, providing additional market support.
A potential liquidity source mentioned is the Federal Reserve’s plan to convert mortgage-backed securities into Treasury bills, which could further improve market conditions. Together, these macro signals align with a scenario of possible recovery within a 4–6 week horizon.
Why This Matters
For miners operating 1–1000 devices, these signs are primarily important for profitability and capacity planning. Reduced selling pressure and improved liquidity may increase price and mining returns, though this is not guaranteed and could take several weeks.
During miner capitulation and short-term hashrate declines, periods of instability may be followed by margin strengthening; thus, decisions to idle equipment or deploy additional machines should consider current hashrate metrics and electricity rates.
What to Do?
- Monitor key metrics regularly: BTC price, network hashrate, and profitability of your ASIC devices every few days.
- Review mining costs and current electricity contracts; if prices rise, calculate breakeven points in advance.
- Consider phased capacity adjustments: avoid shutting down all equipment at once to maintain flexibility amid changing returns.
- Maintain equipment and update firmware—minimizing downtime reduces risk of losses during rapid market recovery.
- Don’t rely on a single indicator: cross-check Stochastic RSI, hashrate, and NFCI signals before making key operational decisions.
These recommendations are not investment advice but practical steps for risk management and operational readiness in the current market environment.