Markets
Why Bitcoin Could Still Drop to $47K in This Market Correction
According to technical analyst Willy Woo, in this market correction, Bitcoin prices could potentially drop to around $47,000.
This scenario would result in an overall retracement of 36%, which is not unheard of in bull market cycles.
On July 8, Woo posted a market overview to his 1.1 million followers on X, concluding that markets had entered a phase of macroeconomic consolidation, but not ruling out further declines.
“This is a deep consolidation designed to shit your pants and liquidate traders to the point of maximum pain. $47,000 is still possible to kill more longs, but the accumulation appears to have begun.”
Bitcoin Accumulation Phase
He blamed selling pressure from the German government and Mt. Gox redemptions for some of the declines, but added that there was much more than those two factors.
He said Bitcoin miners were still capitulating before adding: “Until hash rate goes up, as seen in a tape recovery, the local environment is bearish. Miners are selling, which happens every time after a halving.”
The average hash rate is currently around 600 EH/s, down around 18% from its all-time high in May.
On the topic Bitcoin ETFshe said there were “Surprisingly, they are steady inflows. ETFs are buying the dip,” which is “suggestive of an accumulation pattern.”
On July 8, there were approximately $295 million in spot inflows into Bitcoin ETFs, the highest level since early June, second for Farside Investors.
However, he attributed much of the recent carnage to “futures casinos” or speculative “paper Bitcoin” traders. “The heat map is where the fuel is, the price is the fire,” he said before adding, “
“The price wants to go higher to close shorts up to $77,000, but there is also a lot of downside fuel, $47,000 is the next stop in the opposite direction.”
There is still too much speculation and “paper betting”, so it will be difficult for the price to rise in this situation.
These paper bets increased to create an extra 140,000 paper BTC while the available spot supply remained unchanged, he said before concluding: “Now compare this to the 10,000 BTC sold by Germany and you will understand what really caused the collapse.”
BTC Price Outlook
Woo said the market was in a local bearish environment within a macro bull market, which is a “consolidation and a gift to seated investors.”
The asset has gained over the past 12 hours but remains unchanged in day trading around $57,483. However, it is down about 9% for the week and 17% for the past month.
For BTC to break out of the resistance again, the $58,000 level needs to be cleared.