- BitMine stock has remained inside a narrow range in the past few months.
- Ethereum price has lost momentum, with its ETF outflows continuing.
- The coin may be in the accumulation phase of the Wyckoff Theory.
BitMine stock price has been having a difficult period this year as Ethereum has come under pressure and as its dilution has accelerated. BMNR dropped to the crucial support of $18.30 in May, down sharply from last year’s high of $160. So, will the stock crash further or rebound in June?
BitMine Stock Crashed as Risks Jumped
Tom Lee’s BitMine Immersion has come under intense pressure over the past few weeks as risks have risen. The biggest risk was that Ethereum would continue to fall, moving from a high of $2,470 in April to its current level of $2,020.
It is also slowly forming an inverted cup-and-handle pattern, a common bearish continuation sign in technical analysis. This pattern suggests the Ethereum price may drop to the year-to-date low of $1,765.
Such a move will affect the value of its assets since BitMine is the biggest Ethereum holder. The company has bought 312k coins in the last 30 days, bringing its total holdings to 5.39 million.
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Ethereum is facing major challenges this year. Data shows that spot Ethereum ETFs have had just one month of inflows this year. They shed over $540 million in May after adding $350 million in the previous month. That is a sign that smart-money investors are dumping the coin, expecting its price to keep falling.
Ethereum is also no longer the dominant player in key industries, as it was a few months ago. While it remains the largest player in decentralized finance (DeFi), its total value locked (TVL) has dropped to $40 billion from last year’s high of over $ 480 billion. The crash accelerated after the recent KelpDAO hack.
BitMine stock has also retreated in the past few months because of the ongoing dilution as the company continued raising money to buy Ethereum. On the positive side, the company will soon hit its 5% Ethereum target, thereby ending dilution.
BMNR Stock Price Technical Analysis
The daily chart shows that the BitMine stock price has traded sideways over the past few months. It has remained inside the key support and resistance levels at $18.30 and $23.50 since February. It dropped to the lower side of this pattern in May.
The stock has moved slightly below the 50-day moving average and the Ichimoku cloud indicator. There are signs that it remains inside the accumulation phase of the Wyckoff Theory.
Therefore, the most likely scenario is where the stock rebounds in the coming days or weeks. If this happens, the next level to watch will be at $23.5, the upper side of the horizontal channel. However, a drop below the lower side of this channel will signal more downside.
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