Bitcoin Will Return to $ 50,000 Soon, Says Willy Woo

Key facts:

Bitcoin is currently experiencing a “supply shock” in the market, says Woo.

For the analyst, the target price of bitcoin already exceeds $ 50,000.

After weeks of lateralizing between $ 30,000 and $ 40,000, the price of bitcoin (BTC) is finally about to start a significant new movement. At least that’s what analyst Willy Woo anticipates.

In his most recent newsletter for his subscribers, Woo assured that BTC could be having a big move in the market as soon as starting this Saturday, July 17, with rank until the following Saturday, the 24th of this month.

On these dates, it points particularly to the beginning of the unlocks of up to 40,000 bitcoins from the Grayscale fund, which begins this Saturday, July 17; and the next Bitcoin mining difficulty adjustment, scheduled for Sunday 18.

For the researcher, the behavior in the Bitcoin chain poses a bullish outlook for that price lateralization breakout. That is, according to their estimates, in the coming days we would be seeing the recovery of bitcoin, after the May debacle in which it lost 50% of its value in a period of two weeks.

I expect the price to break out of its lateral downtrend in the next week, followed by a recovery to the $ 50,000-60,000 area before further consolidation.

Willy Woo.

Supply shock would boost bitcoin price

According to Woo’s analysis, bitcoin is experiencing a ‘supply shock’, which is nothing but a time of shortage of coins circulating in the market. This drop in the liquidity of effectively moving BTC, which he himself has recently pointed out, usually impacts the price to the upside.

As an example of this, in the bulletin is a graph showing the supply shock prior to the run at the end of last year, when BTC surpassed its previous all-time high, passing $ 20,000. Just before that move started, there was an increase in the supply shock, which was reflected in the exchanges.

The bullish move in late 2020 was preceded by a supply shock. Source: Willy Woo.

The graph shared by Woo shows a drop in that supply shock in previous weeks, coinciding with the depreciation of bitcoin in the market. But now, the supply of circulating coins is declining again, to levels that place the value of the cryptocurrency over $ 50,000, the researcher wrote.

Bitcoin must assess the imbalance between supply and demand

The bulletin states that the bullish outlook is completed with the union of this supply shock and the accumulation behavior of long-term investors. Only if the latter started selling their coins in the coming weeks could the bullish price breakout be compromised.

Woo sees this bullish break as necessary, since currently the market has not reacted to the decrease in the supply of coins. For this reason, he argued that “the price action has the need to break upwards to properly assess the imbalance of supply and demand.”

We are currently in a new bullish divergence where a supply shock is forming that has not yet been recognized by price.

Willy Woo.

With the current situation of the BTC supply in the market, Woo places the target price above $ 50,000. Source: Willy Woo.

Fear must end for bitcoin to rise again

Given the bullish outlook posed by Woo, the fear of recent weeks among investors must still end, for bitcoin to finally break to the upside. Uncertainty has been taking over the market, given the rapid decline in May and the clear resistance that the $ 40,000 level has opposed.

Yet Woo sees a favorable scenario for those levels to be retaken and stop the fear in the market. Especially with the behavior of “smarter” or more experienced investors continuously accumulating BTC.

According to his analysis, more and more BTC is saved in the long term. Currently, Woo said, there is a spike in accumulation rates, as reported by CryptoNews, while the supply of coins on exchanges decreases. Another sign that liquidity is running low in the market.

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