Willy Woo: Bitcoin (BTC) Hasn’t Bottomed Yet, Three Indicators Why

The prolonged bear market puts even the most ardent holders to the test. Many are supported by regular doses of hopium that come from analysis on the chain. However, it appears that Bitcoin may not have bottomed yet.

That’s according to Willy Woo, one of the most respected on-chain analysts in the crypto space. To back up his claim, he published a series of tweets today. Here we find 3 indicators that show that Bitcoin has not yet reached the bottom.

Has one of Bitcoin’s biggest supporters suddenly turned bearish? Or have we all been looking at chain analysis too optimistically and Willy Woo is just trying to bring back the lost balance?

Bitcoin Has Already Bottomed – Has It?

In regular on-chain analysis provided by BeInCrypto, we have repeatedly pointed to indicators showing that Bitcoin has already reached – or is very close to reaching – the macro bottom of the ongoing bear market. In last week’s analysis, we described 4 on-chain indicators that, according to historical data, seem to confirm that the bottom has been reached.

Among these indicators we find Hash Ribbons, Dormancy Flow, Puell Multiple or Realized losses. In addition, MVRV Z-scores have recently been at historic lows. Even a relatively new indicator called Pi Cycle Bottom supports the narrative that BTC’s macro bottom has already been in place.

Willy Woo: Have we hit rock bottom?

Despite this data and growing ranks of hopium, one of the most well-known and respected analysts on the chain, Willy Woo published a series of tweets today. He began each of them with the question, “Have we hit rock bottom?” And the contents of each seem to answer – no!

The first indicator Willy Woo points out is the cost base. There he compares the cost basis of buying BTC for short-term and long-term holders. It turns out that the declines in the historic bear markets of 2015 and 2019 only occurred when short-term owners achieved a lower cost basis than long-term owners.

Woo adds that this is exactly what happened in 2019. However, in 2015, the final capitulation of BTC took place in this area (red).

Currently, on the cost basis chart, the red line for short-term owners has yet to cross the blue line, which represents long-term owners. When this happens, Bitcoin may reach a final capitulation and reach a macro bottom below the current level of $17,622.

Accumulation of the bear market

The second indicator used by Willy Woo is Bear Market Accumulation. The analyst quantitatively defines accumulation as “coins moving away from sellers to urgent buyers.”

In the diagram he presents, we note the current accumulation period (on the right) and 3 historical periods. Each corresponds to an ascending graph (red, dashed), representing the size of each bear market accumulation.

Willy Woo then draws arrows of the same size (black), whose purpose is to compare the size and duration of the accumulation periods. In this illustrative way, it appears that the current accumulation has reached slightly more than half the level of all previous accumulation periods. Additionally, the macro declines on the Bitcoin chart appeared only after the accumulation peak was reached.

Cost base Density map

The last indicator that the bottom has not yet been reached is the Cost Basis Density Map. This chart is accompanied by a blue line representing the percentage of coins that have lost. In other words, their purchase costs were higher than the current BTC price.

Willy Woo claims that “currently the market has not felt the same pain as previous bottoms.” He points out that today only 52% of the coins are underwater. In contrast, during the macro downturns of previous bear markets, it was 61%, 64% and 57%.

In a comment on your own tweet, he asserts: “History need not repeat itself, especially in modern times with future insurance available that is not picked up on the chain.” He further adds that if we were to reach 60% of coins in loss today, the price of Bitcoin would be at $9,100.

For Be[in]Crypto’s Latest Bitcoin (BTC) Analysis, click here.

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