Bitcoin 'difficulty ribbon' chart hasn't been this bullish since March

Bitcoin simply needs history to repeat itself to see significant price rises, according to two indicators now flipping bullish.

28, on-chain monitoring resource Glassnode noted that Bitcoin's difficulty ribbon compression had broken out of its green "Buy" zone for the first time since the March coronavirus crash.

Difficulty ribbon compression is based on difficulty ribbons, a metric devised by statistician Willy Woo as a way to gauge optimal times to buy Bitcoin.

Ribbons use simple moving average values for mining difficulty, contracting as miners sell BTC to balance costs and then capitulate, often at the end of bear markets.

Compression adds standard deviation to the mixture, allowing analysts to quantify ribbon compression and work out when to enter the market even more precisel.

"Difficulty Ribbon Compression is trending up and broke out of the green buy zone for the first time since March," Glassnode commented the data on Twitter.

Woo agreed, adding that difficulty ribbons were "More reliable personal favourites" among Bitcoin price metrics.

Bitcoin difficulty ribbon compression historical chart showing buy zone breakouts.

Tracking periods in BTC price history from lows to highs against the backdrop of halving cycles, the chart currently gives a strong indication of BTC/USD heading upwards by an order of magnitude into 2021.

As Cointelegraph reported, anticipation continues to build around Bitcoin conforming to historical precedent and launching out of its current range, which has topped out at $12,500.