Bitcoin mining stocks prepare for potential technical challenges
Bitcoin mining stocks have seen a resurgence in value alongside the recent upward trajectory of Bitcoin over the weekend. The leading cryptocurrency has experienced a notable 26% increase from its recent low this month, with market enthusiasts eyeing a potential climb to $70,000.
Among the notable performers, Core Scientific (CORZ) observed a 2.3% uptick in its stock price on Monday. Similarly, Riot Platforms (RIOT), Marathon Digital (MARA), Iris Energy (IREN), Cipher Mining (CIFR), and CleanSpark (CLSK) all recorded gains exceeding 2%.
Investor optimism surrounding Bitcoin’s recovery in the current year has been a driving force behind the surge in these companies’ stock prices. A significant portion of Polymarket users, totaling 67%, are anticipating Bitcoin’s value to reach $70,000 by the end of this month, a substantial leap from its current valuation of $67,000.
An anticipated catalyst for this bullish trend is the prevailing sentiment that Donald Trump is poised to outperform Kamala Harris in the upcoming election. Market analysts anticipate a further increase in Bitcoin’s value in anticipation of the upcoming Bitcoin event in Nashville, where Donald Trump is scheduled to address attendees and participate in a high-profile campaign fundraiser where tickets are fetching over $800,000.
The performance of Bitcoin mining stocks is closely tied to the cryptocurrency’s upward movement, as it directly impacts their revenues and profitability. This price surge holds particular significance as many miners had reduced their output following the halving event that occurred in April.
Moreover, industry experts have noted signs of consolidation within the sector, with Riot Platforms initiating a bid for Bitfarms earlier in the year, while Core Scientific recently declined a buyout offer from CoreWeave. Recent reports from Bloomberg have indicated that Cipher Mining is contemplating a sale following acquisition bids, hinting at potential acquisition opportunities for firms looking to expand their artificial intelligence (AI) capabilities through Bitcoin mining companies.
On the technical front, these companies face risks as chart patterns present conflicting signals regarding Bitcoin’s future price movements. Notably, veteran prop trader Peter Brandt highlighted that the current formation does not align with a bullish flag pattern, suggesting a prevailing downtrend in Bitcoin’s trajectory.
However, there are indications of a falling broadening wedge pattern forming, a positive signal for potential bullish momentum. Bitcoin’s position above the 200-day moving average further supports the possibility of an upward trend. Market observers, including Michael Novogratz, emphasize that a definitive confirmation of further Bitcoin upside would require a breach of the year-to-date high of $73,400.
