2021-5-24 15:32 |
On-chain analyst Willy Woo is suggesting that with regard to the figures of bitcoin entities net growth, the ongoing bull market remains intact.
In the same regard, PlanB, creator of the stock-to-flow (STF) bitcoin model, believes that the current correction is within the acceptable deviation of his popular model.
Both analysts argue that bitcoin will likely regain lost levels and that the bull market will continue.
Willy Woo: BTC just warming upThe recent drop in bitcoin price has been seen by some as a dramatic event and a clear signal of impending stagnation of the crypto market. Others, on the other hand, consider these lows a discount sale.
One of the most famous on-chain analysts, Willy Woo, posted a long-term chart of Bitcoin Entities Net Growth. The chart shows that the collapse of the BTC price did not result in a radical drop in network entities.
Entities Net Growth / Source: TwitterOn the contrary, the 14-day moving average over the last period has clearly broken out. Indeed, there has been some decline in the value of this on-chain indicator as Bitcoin was following the Wyckoff distribution in search of a local top. However, the current price collapse has paradoxically led to a significant increase in network entities.
Compared to the bubble peaks of previous cycles, this behavior is unexpected. Both in 2013 and in 2017, the BTC peak led to a dramatic decline in the growth rate of BTC users. For many months that followed, it could not regain lost values. Today, we can see that the indicator has already broken its previous peak, but the price has not yet experienced a clear bounce.
According to Willy Woo, this is a signal that new entities are entering the market and that the structure of the long-term bull market remains intact. Moreover, he emphasizes that the number of Bitcoin users has doubled every year since its inception:
“So the 2021 peak is expected to end at levels MUCH higher than the 2017 peak. Under this trend, we are just warming up.”
PlanB: Just an STF deviationA similar opinion was shared by another well-known macro analyst, PlanB. The creator of the well-known bitcoin stock-to-flow model claims that the current BTC price, hovering around $36,000, is still within the acceptable deviation.
Following PlanB, it can be roughly stated that the model price for Bitcoin today is $60,000 (black line). The upper deviation is double this value at $120,000 while the bottom deviation is half of it ($30,000).
These two lines create the STF model channel (blue band), the maintenance of which is crucial for the continuation of the cryptocurrency bull run.
The Stock-to-Flow Model / Source: TwitterFinally, PlanB concluded that it would be a cause for concern if the BTC price remained around $30,000-$35,000 for the next several months. However, the analyst expects “BTC price to bounce back next days/weeks.”
For BeInCrypto’s latest Bitcoin (BTC) analysis, click here.
The post Analysts Argue the Bitcoin Bull Market Still Intact Despite Market Downturn appeared first on BeInCrypto.
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