The Hash Ribbon indicator, which serves as an on-chain metric for spotting periods of miner capitulation and subsequent recovery, has just signaled a bullish trend for Bitcoin. Notable members of the BTC community have brought attention to this development via posts on X, indicating that this signal might signify a pivotal moment in the market.
Is This the Ultimate Bitcoin Buy Signal?
Originally developed by on-chain analyst Charles Edwards, the Hash Ribbon utilizes two moving averages (typically the 30-day and 60-day averages of Bitcoin’s hash rate) to assess when mining difficulty and hash power may have capitulated and are beginning to recover. A “buy” signal is typically triggered when the 30-day MA crosses above the 60-day MA with conviction, suggesting that any miner-related distress has likely ended.
Historical records reveal that significant buy signals often emerge after dramatic market declines, frequently aligning with cycle bottoms. While the indicator is not perfect, it has successfully identified several previous lows in Bitcoin’s history—most notably during 2011–2012, at the depths of the 2014–2015 bear market, around the $3k bottom in late 2018–early 2019, and close to the $29k mark in mid-2021.
Immediately following the latest crossover, prominent commentator Bitcoin Archive tweeted: “BITCOIN HASH-RIBBON FLASHES BUY SIGNAL – This is one of the most reliable ‘buy’ indicators. Significant price gains have followed 7 out of the last 7 times this indicator was activated.”
Edwards himself retweeted this message, a gesture many interpreted as an affirmation of the analysis. Adding to the discourse, a user pointed out: “This signal has flashed only 20 times in Bitcoin’s history. In 17 out of 20 instances, the most recent local low was never breached on a closing basis. We may sweep the lows or even wick beneath them, but 85% of the time, the low’s in and it’s only upward from there.”
Meanwhile, Jamie Coutts, chief analyst at Real Vision, emphasized the need to monitor various on-chain metrics, even as the Hash Ribbon indicates bullish trends: “The well-regarded Bitcoin Hash Ribbon signal just activated. While on-chain activity remains tepid, metrics that historically correlate with future price performance are signaling green.”
It’s important to note that many on-chain indicators haven’t reached the levels typical of previous cycles, despite Bitcoin’s price nearing $110,000 in mid-January. Likewise, traditional technical indicators also haven’t peaked at past highs.
Tony Severino, a Chartered Market Technician (CMT) and Head of Research at NewsBTC, recently transitioned from a bullish to a bearish outlook on Bitcoin. Severino, who is also the founder of CoinChartist.io, contends that Bitcoin’s current price action and on-chain metrics fail to substantiate the bullish narratives seen in prior cycles.
“Believing that Bitcoin MUST achieve prior extremes on indicators is a perilous mindset. Higher highs in price paired with lower highs on oscillators signal bearish conditions,” Severino remarked recently.
Severino cautions against expecting Bitcoin to replicate its historical tendency to drive certain momentum indicators (like RSI or MACD) to extreme levels. Instead, he points out that divergences—where price reaches new highs but technical indicators do not validate those highs—can indicate market exhaustion. “The tools I use are bearish, period,” he conveyed via X.
As of this report, BTC is valued at $87,373.
