Bitcoin and Ethereum prices fell after reaching peaks in March 2024. After Bitcoin rose to new all-time highs of around $73,800, it took just under five months for prices to take a sharp dive, dropping below $50,000 in early August.

Amidst this sell-off, Ethereum was not spared either. On August 5, the coin dropped as low as $2,100. Although prices rallied in the days following these losses, the uptrend momentum was shaky and there are doubts whether buyers will be able to sustain the rise.

Bitcoin Hash Rate Rises: Is Miner Capitulation Over?

Traders are keeping a close eye on the market, how the two largest coins perform and whether they can get back on their feet. The on-chain data points to encouraging developments.

Data from CryptoQuant indicates that Bitcoin and Ethereum are in the final stages of a market dip and are likely to continue a buying trend, confirming Q1 2024 gains.

In a post on X, CryptoQuant analysts weighed in on the state of Bitcoin mining and whether miners have recovered after the capitulation in July. Citing the Hash Ribbon indicator, a tool often used by analysts to measure capital capitulation, CryptoQuant notes that the network hash rate is increasing, recently spiking to new all-time highs of 638 EH/s.

This development means that after the rush from May to July following the halving on April 20, miners have been upgrading their equipment and deploying more computing power to stay competitive.

It can also be inferred that miners are optimistic about the future, which explains their decision to reinvest in new and efficient equipment.

Analysts say the end of mining capitulation, as is currently the case, is often preceded by sharp price increases.

However, the price remains likely to recover and break above $60,000, as previous prices do not repeat but rhyme. Local resistance at $63,000 also remains high.

The tailwind for this growth will mainly be due to optimistic reduction of BTC selling pressure by miners.

Ethereum buyers take the lead as open interest rises

Meanwhile, an analyst, citing CryptoQuant, notes that Ethereum could also be poised for gains. Currently, ETH bulls are struggling to reverse the losses of August 4 and 5.

The immediate liquidation line is around $2,800. If the bulls continue, a close above this zone could set the stage for a fresh upward move, sending prices in a refreshing recovery towards $3,500.

The analyst notes that the Ethereum Taker Buy Sell ratio has increased, which measures the balance between buying and selling pressure. This development suggests that buyers are gaining strength, a net positive for bulls.

At the same time, Ethereum’s open interest on leveraged positions on various futures trading platforms has increased after a decline, especially in June 2024. The fact that more positions are being opened means that investors are gradually regaining confidence, potentially fueling a rally.

Main image from Canva, chart from TradingView