The recent rise in the value of crypto assets has trickled down into the “traditional” world of finance, more specifically into the stocks of crypto mining companies. Furthermore, the growth of crypto prices increased the profitability of mining, which has caused some mining operations to increase up to 120%.
Some of the major crypto mining companies such as Marathon Digital Holdings (NASDAQ: MARA ), Riot Blockchain (NASDAQ: RIOT ), Hut 8 (NASDAQ: HUT ) and Core Scientific (NASDAQ: CORZ ) increased their share price in the last 30 days by respectively 124.12%, 96.69%, 98.95% and 110.39%.
It appears that cryptomining stocks were deep in oversold territory, and the rally seen over the past month can be attributed to both a pullback from those levels combined with a rally in crypto initiated mainly by Ethereum (ETH) as it nears the transition to proof- of-stake (PoS) network.
An increase in Bitcoin (BTC) mining appeared to have occurred across the board with the above companies.
Core diagram and analysis
Namely, Core reported in their earnings release that the rate at which self-mined Bitcoin increased in Q2 was 1601%, reaching 6567 BTC in their custody. Revenue increased by 118% year-on-year (YoY).
In the past month, COR-Z has traded in the range of $17.75 to $20.57, with technical analysis indicating a support line at $18.76 and resistance at $20.18.
HUT chart and analysis
Meanwhile, Hut 8 increased their BTC mining by 71% as stated in their production update, using what they call more efficient miners and increasing their revenue by 30.7% year over year.
The short-term trend is positive, while the long-term trend remains negative, with the support line at $2.06 and a resistance line at $4.19.
MARA chart and analysis
Marathon used the proceeds to highlight that they were also increasing BTC production, taking 707 Bitcoin in the quarter.
Looking at annual performance, MARA outperformed 75% of all other stocks, with prices rising sharply recently. The resistance line is at $19.14, while the support line is at $13.48.
RIOT Chart and Analysis
Finally, Riot claimed to have increased revenue by 244% for the quarter, while increasing mining output by 186% to a record 1,405 BTC compared to 491 BTC in the previous quarter.
Over the past month, RIOT has traded in a wide range between $5.35 and $10.52, with the support zone extending from $7.52 to $7.64, while the resistance is at $16.34.
Some clouds on the horizon
It’s not all sunshine and rainbows, as the major crypto miners posted increasing losses to go along with increased revenues. Additionally, BTC miners often sell 30% of their holdings; however, in June this number rose as high as 400%, due to devaluation losses on their crypto holdings.
Market participants should keep in mind that BTC miners faced quite a few challenges this year, tech stocks plummeting on the Nasdaq, rising inflation and prices, falling crypto prices and rising energy costs. Adding all of these challenges together produces a difficult environment in which crypto mining stocks can extend and continue the current rally.
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