16:34'It will send BTC' — On-chain analyst says Bitcoin hodlers are only getting stronger
Willy Woo says Bitcoin could hit $200,000 in 2021 because long-time investors are more confident in the ongoing rally.
According to on-chain analyst Willy Woo, the price of Bitcoin (BTC) could achieve a "conservative" target of $200,000 in 2021. The prediction revolves around the fact that long-time investors seem more confident in the recent rally.
There are two key data points that suggest Bitcoin’s ongoing rally could explode higher. First, “HODLers,” or long-time BTC holders, aren't moving their funds for longer than in previous rallies. Second, BTC held on exchanges continues to decrease, which reduces selling pressure.
A bullish Bitcoin re-accumulation phase is happening
The re-accumulation of Bitcoin has remained a consistently bullish trend throughout 2020. It has continuously decreased the selling pressure on BTC, allowing a more stable rally without major 30%-40% corrections as frequently seen in 2017.
Woo noted that he is bullish for 2021 because Bitcoin’s re-accumulation phase means the amount of BTC that could be sold is much lower compared to the previous bull cycle. He said:
Atop the declining Bitcoin reserve on exchanges, Woo found that HODLers are “holding stronger.” In 2017, the amount of gain per the amount of capital invested in Bitcoin hovered at around $0.25. This figure increased to $0.35 in 2020, which means more investors expect event bigger profits in the future.
Bitcoin market cap gain per dollar invested. Source: Woobull.com
Based on the combination of the two optimistic on-chain trends, Woo said that Bitcoin could achieve a "conservative price" of $200,000 by the end of 2021. He explained:
Bitcoin HODL waves. Source: Glassnode, Unchained Capital
As reported in May, Bitcoin HODL wave data also supports the argument the HODLers from the 2017-2018 bull cycle aren't selling at these relatively high prices, including high-net worth individuals or "whales."
However, this data also suggests that some earlier HODLers from three to seven years ago are taking profit after a prolonged BTC rally, heightening the chances of a correction in the short term.
Woo called a massive BTC rally in March 2020
As Cointelegraph previously reported, Woo has been calling for an extended Bitcoin bull run since March 2020.
On Mar. 4, Woo told Max Keiser, the host of RT’s Keiser Report, that Bitcoin could hit $135,000 in the bull run. He said at the time:
Although the price of Bitcoin fell to sub-$4,000 on Mar. 12 in a “Black Thursday” crash that shocked the market, it has swiftly recovered since.
The bull trend that was bound to happen in March before the crash appears to be in full swing now following BTC’s strong nine-month recovery.
But in the near term, analysts believe that the likelihood of the recovery in the U.S. dollar could cause Bitcoin to see a minor pullback. Following the biggest three-week liquidation in the gold market, analysts also see the precious metal rebounding, which could stall BTC’s momentum in the short term.
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