Analyst Willy Wu believes that Bitcoin may not return to $6,000 in the foreseeable future.
He made such a forecast on the basis of his recently presented "Bitcoin complexity ribbon" indicator. On the contrary, according to Wu, the capitulation of miners, which is likely to occur along with the halving of Bitcoin in 2020, "will throw oil into the bull market.
In a conversation with trader Thomas Weiss on Wednesday, Wu pointed out that the bandwidth of difficulty unfolded in December 2018, when Bitcoin was trading at a minimum of about $3,200 per cycle.
"For me, this factor was an additional confirmation that we entered the bullish season. There are fewer such people now, but there are still those who think we are in the middle of the rally against the background of the bear market, we are experiencing the "B" wave and will go down," Wu said.
According to the analyst's version, the capitulation of the miners that took place in December will be supported by another capitulation in the summer of 2020 and a decrease in Bitcoin emissions, which makes a serious drop from current levels unlikely.
"It is very unlikely that the price will ever fall below the minimums at which the accumulation takes place. Very unlikely. Even up to $6,000, given the current market situation. I'm talking about a long-term macro picture," he added.
Wu said that after the publication of the Bitcoin complexity tape, several traders confirmed that they had previously evaluated the activity of miners in forecasting the market movements, but preferred not to spread about this indicator.
The analyst also turned to his favorite NVT indicator, which is defined as the total capitalization of the network, divided by the amount of transactions per day. Now NVT looks unstable, explains Wu and connects it with climate change in the market. More and more people are keeping their bitcoins on the stock exchanges, which is why NVT's efficiency is falling. According to Wu's estimates, more than 6% of all mined bitcoins are on stock wallets. Transactions with them are not registered in blockchain, which cannot but affect the NVT.
"We are definitely in the bull market now, and we could expect the NVT to fall, but it does not happen. Much of the activity has gone beyond blockchain, so getting a signal has become difficult," he explained.