BitMine’s share price continued to consolidate as traders awaited the outcome of a crucial shareholder vote and after Standard Chartered analysts made a bold Ethereum prediction.
Summary
- BitMine stock has formed a double bottom pattern on the eight-hour chart.
- Voting by major shareholders on the increase in authorized shares will end on Wednesday.
- Standard Chartered predicts that the price of Ethereum will rise to $7,500.
BitMine, which is partnered with Tom Lee, was trading at $31.60, a level it has held at in recent days. This price is slightly above the key support level of $28.75, where it formed a double bottom pattern.
BitMine shares will react to the outcome of a vote of major shareholders that ends on Tuesday. Shareholders are voting on whether to increase the number of authorized shares from the current 500 million to 50 billion, a move that could lead to substantial dilution over time.
Lee has argued that the goal is not to dilute the shares of Peter Thiel, Cathie Wood and Jonathan Bates. Instead, he maintains that the raise will provide the company with the cash it needs for strategic acquisitions, to enable selective “at-the-money” capital raising and to accommodate future stock splits.
The company also argues that it will soon reach the current authorized share limit, implying that it may stop accumulating more Ethereum (ETH) to achieve its goal of owning 5% of the market capitalization.
There are signs that BMNR’s share price will exhibit elevated volatility in the coming days as investors react to the voting results. Data compiled by Yahoo Finance indicates that implied volatility has risen to 97%, close to its all-time high of 103%.
On the positive side, BitMine has begun monetizing its Ethereum holdings by staking tokens valued at over $3 billion. His goal is to eventually stake all of his Ethereum coins, meaning he will make over $500 million a year once he reaches his goal of owning 5% of the market cap.
Also, Chartered Standard Analysts believe Ethereum has numerous catalysts that will take it to $7,500 over time. A move at that level would value BitMine’s Ethereum hoard at over $32 billion.
BitMine Stock Price Technical Analysis
The eight-hour chart indicates that the BMNR stock price has remained range-bound over the past few weeks. A closer look shows that it has formed a double bottom pattern at $28.76 and a neckline at $41.
Therefore, this pattern means that the bears have been hesitant to place trades below that level. As such, the most likely scenario is a bounce as the bulls target the neckline at $41.2. A move above that price will indicate further gains, potentially up to $50 or more.
