Bitcoin price metric that called the 2020 bull flashes again

An “elegant” Bitcoin (BTC) metric that predicted its run to $ 12,000 in August again trended upward for the first time since July.

As Noted by creator Charles Edwards on December 3, the Hash Ribbons indicator is now signaling buyers to enter the Bitcoin market.

Hash ribbons display a rare “blue dot”

Uploading an annotated chart to social media, Edwards, who is also the founder of digital asset manager Capriole, noted similarities between Bitcoin now and before previous bullish spikes throughout this year.

“Look what I found. A blue dot,” he commented, identifying the new entry point.

Hash tapes are based on the behavior of the Bitcoin network hash rate and are designed to indicate to investors when the price is due to rise.

In theory, when miners surrender due to events such as a major price correction, the hash rate drops, only to revive thanks to automated Bitcoin difficulty readjustments. The hash ribbons demonstrate that halfway through this minor surrender is an optimal time to take a stand.

As the saying goes, “price follows the hash rate” in Bitcoin, hash ribbons provide technical proof of the popular mantra.

Edwards’ “blue dot” occurs when the 30-day hash rate crosses the 60-day value, indicating that a recovery is in progress.

“Hash Ribbon will soon set up a buy signal”, Rafael Schultze-Kraft, Technical Director of Glassnode, on-chain analysis resource, continued with another graphic.

“When the hash rate recovers (30d MA goes above 60d MA) and BTC price dynamics are positive, Hash Ribbon has given great entry points.”

Schultze-Kraft described the hash tapes as “elegant” for the reliability of the indicator. In July, around the time of the previous ‘blue dot’ event, it took a few weeks for Bitcoin to post highs not seen in over a year.