It’s coming up to two months since Bitcoin peaked at $65,000. Since then, significant dips have seen a 55% drop in price at the lowest point.
For the past three weeks, BTC has formed a trading range of between $31,000 to $40,000. But the lack of strength in any upward price swings has cast doubt on whether we are still in a bull market.
Nonetheless, speaking on the Unchained Podcast, on-chain analyst Willy Woo shared his examination of the data, and he predicts things will change soon.
Are we still in a Bitcoin bull market?
On the question of where the market stands, Woo said, in his opinion, we are in a reaccumulation phase recovering coins dumped by whales during the recent shakeout.
He warned that this may take some time. However, once the Bitcoin price suitably picks up, sidelined stablecoins will jump back in to sustain an uptrend.
“So many whales dumped out, and it will take a little time for those coins to be reaccumulated. I think once the price action starts to tip properly bullish, so maybe a little bit of sideways, and when the price action starts to look good I think a lot of those stablecoins will come back in,” he said.
Based on similar incidents in the past, of highly over-extended sell downs and BTC price below fundamentals, he predicts the recovery will mirror what was seen in March 2020’s “covid-crash.”
Back then, the market was also overextended, and the price was below fundamentals too, but a snapback quickly occurred.
However, the main takeaway is that, despite a sentiment of extreme fear, the data and metrics do not support the case for a bear market.
“The structure is not bearish. If this is a bear market it’s the weirdest darn bear market I’ve ever seen. And if it keeps dropping from here, it’s like, what’s wrong with this network, is it broken? We’re very oversold,” he stated.
End of year price predictions
Fellow podcast guest Rafael Schultze-Kraft, the co-founder of data analyst firm Glassnode, echoed much of what Woo said. But pointed out that he isn’t as optimistic as Woo regarding the speed of the snapback.
In terms of giving an end-of-year price prediction, Schultze-Kraft did not give a direct response. Whereas, Woo said his modeling method, prior to the crash, showed a price prediction of up to $500k EOY.
However, adjusting his model to account for the crash, Woo gives a revised prediction of between $200k – $300k.
