BitMine Immersion Technologies is transitioning to a high-risk phase as the company's paper losses on Ethereum holdings continue to deepen. The stock has failed to maintain its recent recoveries, and both technical and crypto-related signals indicate weakening confidence.
On February 10, BitMine had nearly 15 billion dollars in invested capital. Currently, the portfolio value has decreased to around 7.7 billion dollars.
Almost 49% of the investment's value has thus been lost on paper. Meanwhile, the price of Ethereum is around 1,950 dollars, while BitMine's realized purchase level is close to 3,850 dollars. Since the price of ETH is nearly 50% below the average purchase level, most holdings are deeply in loss.
Losses at the cost base and hidden divergence signal increasing selling pressure.
BitMine's biggest weakness is the decreasing safety margin.
The realized price shows at what price the company has acquired most of its Ethers. When the market price stays significantly below this level, companies are under pressure to reduce risk.
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Current data shows:
Average ETH purchase price: $3,850
Current ETH price: $1,950
Unrealized loss: 49%
This puts BitMine in a vulnerable position. Technical signals reinforce this risk.
Between November 18 and February 9, BMNR made lower highs on a daily basis, while the Relative Strength Index formed higher highs. RSI measures sentiment by comparing buying and selling strength. When price makes lower highs, but RSI makes higher highs, hidden bearish divergence occurs. This indicates a weakening sentiment underneath.
The selling pressure returned after the divergence appeared. BMNR recovered nearly 26% from January lows. However, the price rally could not hold, and now the risk is a new decline as the divergence and rising average buying pressure weigh on the market.
Weak cash flow and crossover risk indicate a decline in confidence.
Movements of large investors show early signs of hesitation. The Chaikin Money Flow, or CMF, measures whether large investors are accumulating or reducing their holdings. Values above zero generally indicate buying interest. If the value is below zero, selling pressure is greater.
Between the end of November and the beginning of February, the CMF rose even as prices fell. This indicated some long-term support that is still continuing. However, during the latest 26% recovery, the CMF failed to break the descending trend line and did not reach new highs or rise above zero. This indicates that the price rally lacked strong support from large wallets, and the current trend still favors sales by large investors.
Moving averages also provide a warning. The 100-day exponential moving average (EMA) is now approaching the 200-day EMA. The exponential moving average gives more weight to recent prices and helps identify early direction changes.
When the shorter-term moving average falls below the longer one, it often signifies deeper weakness. Previously, on January 27, a bearish death cross formed when the 50-day EMA fell below the 200-day EMA. After that, BMNR fell over 44%.
If a second bearish crossover occurs, selling pressure could accelerate, although it may not be as significant as a death cross. This risk increases if Ethereum remains weak. BMNR still shows moderate correlation with ETH at around 0.5 level.
Ethereum's ongoing weakness could push the stock directly downward.
Important BitMine stock-level levels indicate where the next decline could start.
The increase in losses at the cost base makes the price structure of BitMine stock critically important. The most important short-term support level is found around $17, slightly over 10% below the current level. This level has served as a base in recent consolidation.
If BMNR loses $17, the downward trend could clearly strengthen.
Below this area, the next support is found near $15. If it fails, Fibonacci projections indicate $11, which is a 0.618 level retracement – historically a strong support level. Moving towards $11 would mean a decline of over 40% from current levels.
On the upside, reclaiming is challenging. The price of BitMine stock needs to rise back above $21 for pressure to ease immediately. This level hits previous resistance.
Only above $21 does the short-term structure begin to improve. To move towards $26, stronger Ethereum prices and renewed interest from large players are needed. Currently, both are uncertain. As long as ETH trades significantly below BitMine's cost basis and cash flows are weak, recoveries are likely to face strong selling.
