Since peaking at local highs of $12,075 last week, Bitcoin has experienced a strong drawdown as depicted in the chart below. The leading cryptocurrency has fallen as low as $9,995 as of this article’s writing and has traded even lower than current levels as sellers have ravaged the BTC price.
It’s been a move that has surprised most investors: crypto derivatives tracker Skew reports that more than $400 million worth of Bitcoin derivatives has been liquidated over the past five days.
One prominent trader, though, predicted the retracement. Willy Woo, an on-chain analyst and investor, noted on Aug. 25, prior to the correction, that the “next move is [likely to be] bearish,” citing technical and on-chain trends. In the analysis, he suggested that Bitcoin is likely to bottom in the high-$9,000s.
Woo, having been proven correct thus far, recently came back on the record to state that a near-term bottom for Bitcoin is likely near.
Willy Woo: Bitcoin likely nearing a bottom
According to Woo’s latest tweet posted on Sep. 6, Bitcoin may be nearing a near-term bottom due to a shift in on-chain momentum:
“Local on-chain switching bullish (looking at the next few weeks out), not calling this has bottomed, even though it may have. Playing the big swings it’s not a bad time to buy back in.”
He added in his replies that there’s a likelihood Bitcoin whales “front run” a CME futures gap at $9,600, which many traders have mentioned as a local target for the leading cryptocurrency. BTC front-running that level would mean that the bottom is imminent as opposed to much lower than current price action.
“I also wonder about the gap being front run, to fill longs with solid liquidity. Whales on derivative exchanges have enough dominance to make that so,” Woo said on the potential of the level being front run.
Macro bull case still potent
Whatever happens to Bitcoin in the near term, many remain convinced that the macro case for the cryptocurrency to appreciate remains intact.
Raoul Pal, the CEO of Real Vision and a Wall Street veteran, has recently asserted that macroeconomic factors almost make it that Bitcoin is the only asset that’s viable to own. He added that BTC may be the best-performing asset for the next two years.
Arthur Hayes, the CEO of BitMEX, has also recently reasserted his bullish sentiment. In the latest edition of his monthly newsletter, the investor wrote:
“The financial markets are going to whipsaw as politicians contort themselves to continue feeding at the trough… Out of the chaos, more people will mistrust centralised authority and look for ways to protect their physical persons and capital from the wanton destruction waged upon them by their rulers.”