Traders’ leverage generating cascading position closings caused the price of Bitcoin to drop. Woo’s newsletter states that the value of the first cryptocurrency should return to USD 50,000 when the accumulation is complete.
Market analyst Willy Woo believes that the latest sharp drop in the price of Bitcoin (BTC) could be a bear trap. In his most recent newsletter, Woo stated that the large-scale movement of the pioneering cryptocurrency is to the upside.
In trading, a bear trap is a time when the performance of an asset could experience a reversal of the upward trend. It is a trap because it leads investors to take positions to the downside, expecting a sharper drop that does not occur. On the other hand, there are bull traps when an upward movement seems to reverse a downward trend.
The expert concluded that there is currently a bear trap as the supply and demand data is strongly bullish while the upward possibilities are limited.
Additionally, Woo believes that traders’ leverage generating cascading position closings caused the drop in the price this week. The downturn did not occur due to sales by investors, which is a common bearish sign. He explained that investors are accumulating a lot instead and are controlling the price in the long term.
Woo is an analyst known for his metrics and markedly bullish bias towards Bitcoin. He reiterated that long-term investors are permanently accumulating BTC expecting new all-time highs.
Due to that behavior and the stability of prices until last week, he concluded that the recent fall is not sustainable in the medium and long term. He claimed that precise price action was taking place on the top floor of USD 30,000.
The Price of Bitcoin Will Recover USD 60,000 and Go for More
In his newsletter, Willy Woo states that the price of the first cryptocurrency should return to USD 50,000. The analyst predicts that this will take place once the accumulation at this stage is complete.
As for the long term, he expects that there will be another big bullish run later this year or even in 2022. In his previous report, he even suggested that the value of BTC could soon return to USD 60,000.
Woo believes that the rise to USD 60,000 will precede the search for new all-time highs. In addition, he believes that it will break the ceiling of just over USD 64,000 in force until now.
Previously, he had anticipated that the price of Bitcoin could reach between USD 100,000 and USD 200,000 during this bullish cycle. In particular, he expects that to happen later this year and in early 2022, as models by other analysts suggest.
Those forecasts would come true if the value of the cryptocurrency rose by more than 100% in the months to come. The cryptocurrency is trading at around USD 45,300 and has a market capitalization of about USD 852 billion, according to CoinGecko.
By Alexander Salazar