As Bitcoin (BTC) plummets below $8,000, Adaptive Capital digital asset strategist Willy Woo is recanting his earlier bull run forecast for the leading cryptocurrency.
Last month, the crypto analyst and influencer tweeted a chart that he said revealed how strong on-chain fundamentals backed Bitcoin’s breakout above $10,000.
This breakout is the real deal. Fundamental investment activity is backing this $10k breakout. pic.twitter.com/IDWmhXX2Mj
— Willy Woo (@woonomic) February 9, 2020
The price of Bitcoin has since crashed after hitting its recent highs. Although Woo says he believes Bitcoin’s long-term prospects are solid, the indicator now suggests a more worrisome situation in the near term.
“This is a chart of on-chain ‘investor activity’ right now. Long term looks solid.
Short term is very weird, normally it’s smooth oscillations, not anymore, it’s like something hit it (#COVID19?), it’s fizzing out. Waiting for this to reverse before we put in a bottom. Maybe soon.”
Woo says Bitcoin’s fallout is due to a black swan event – a name for an extremely rare and unforeseen circumstance that causes catastrophic damage to the economy. Because they are unpredictable, black swan events are not accounted for in financial forecasts.
“I was totally wrong on this call… “no chance this is a top” just below 10k.
The market right now, crypto and traditional, is undergoing a black swan.”
The black swan metaphor is now extensively used to describe the coronavirus, which has infected over 118,000 worldwide since it was first reported in December of 2019.
Fallout from the virus has triggered a global market downturn that has not spared Bitcoin and the crypto market at large. At time of publishing, BTC is down 1% at $7,838, according to Coin360.