Three reasons why Bitcoin is oversold

Three reasons why Bitcoin is oversold - bitcoin quantum computers 1140x600 1The Bitcoin price retested the $ 18 support level on Friday. It is the third time in a week, with the cryptocurrency failing to break out of the resistance at $ 19,5 twice on the 5-day chart.

The cryptocurrency trading price for a piece of the world's first blockchain currency continues to consolidate around $ 19. This has been the trend of Bitcoin (quotation BTC) in September.

On the six-month, one-year and one-year charts, bitcoin is deeply in the red. This is the third prolonged capitulation in the history of cryptocurrency, referred to as the “crypto winter” by longtime traders.

However, despite the deep freeze in prices, here are three reasons why Bitcoin is oversold like crazy right now.

Bitcoin's hash rate hit an all-time high in September

Keeping in mind that trading market prices ultimately seek to evaluate fundamentals, the fundamentals of the network are strong. Indeed, the hash rate of the Bitcoin network hit a new all-time high in September.

On September 17th, the hash rate rose to 234m TH / s (terahashes per second). Additionally, this represents a 55% increase over the July Bitcoin hash rate.

A fundamental analysis of the price of bitcoin could take into consideration the price of the amount of network infrastructure in operation. The hash rate is a reliable and practical measure. With the price dropping for the current year, as the hash rate hits new records, BTC looks very oversold.

Bitcoin miners continue to add ASIC units and mining facilities

Meanwhile, even as the hash rate is skyrocketing, miners continue to build and expand the infrastructure. This is incredibly good for bitcoin's long-term outlook.

For example, CleanSpark Inc, a Nevada-based bitcoin miner, recently spent $ 33 million to acquire a turnkey mining facility in Sandersville, Georgia. The publicly traded firm (NASDAQ: CLSK) has advised investors to forecast that it will continue adding ASIC miners to its fleet until 2024.

Institutional investors are not holding back

Another strong indicator of a future bull run is the greedy and growing interest of institutional investors. The Nasdaq, for example, is one of the last Wall Street incumbents to have started rolling out a custody service for institutional investors looking to enter the world of cryptocurrencies.

Institutional investors are both smart and conservative. As more risk-averse hedge funds, large banks and mainstream financial firms turn to cryptocurrency services, investors will notice the long-term bullish trend.