Crypto analyst Willy Woo is examining the on-chain metrics of Bitcoin (BTC) to determine the flagship cryptocurrency’s current market state.
Woo says on the What Bitcoin Did podcast that, based on on-chain analysis, Bitcoin is not exhibiting a “bear market setup.”
“Structurally on-chain, it’s not a bear market setup. Even though I would say we’re at peak fear. No doubt about it, people are really scared.”
The on-chain analyst says that the high levels of fear in the market present an opportunity as an upward retracement is likely.
“It’s an opportunity to buy. You don’t often get this kind of pullback without it relief-bouncing even. You don’t sort of slide, slide, slide and then capitulate.
We’ve come down from $69,000 to $33,000. It would be hard-pressed to capitulate from $33,000 down to say $20,000. Because that’s like retracing something like a 2018 bear market over two and a half months instead of a year right.”
Woo also says that demand for Bitcoin is returning as various investors resume buying.
“Structurally, it’s [Bitcoin] very, very strong and demand started to come back. And the hodlers [longtime Bitcoin holders] that were slightly being just dispirited by the futures traders selling down have stopped selling. They’re rebounding now, and there’s accumulation coming.
The whales are now, and when I say whales these are guys with more than 1,000 Bitcoins, I term a lot of those guys as potentially institutional investors, they are starting to flip over to buying. They peaked their selling in December, so you could say institutions were selling down in December, which is kind of a part of their normal cycle – they sell down, they redeploy in January. Looks like that started…
The futures, you know, coming off the Chicago Mercantile Exchange [CME] and ETF [exchange-traded fund] and you know all the other futures exchanges. But I primarily think that the CME and these futures ETFs drive a lot of this now. That demand started to come in. It started coming in a few days ago.”
Bitcoin is trading at $37,369 at time of writing, down about 46% from its all-time high.
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