Bitcoin Analyst Ben Cowen Reveals Why the Current Market Drop Could Develop into Something Bigger
Analysis of the BTC/ALTs chart revealed that the ratio has finally broken below the support level – an exact mirror of what occurred before 2018’s BTC drop off.
However, with the Bitcoin halving occurring later next week, analysts are still very much split on the impact the event will have on BTC’s price, supply and demand.
Bitcoin has entered a ranging market ever since it broke through to post a USD all-time high in mid-March. Many traders hoped that BTC’s push to new heights was just the beginning of a major bull run, but in the shadows of the next halving, Bitcoin appears to have found its ceiling for now. Bitcoin has consistently bounced between its USD $72K (AUD $111K) resistance level and USD $62K support (AUD $95K), a sign of investors consolidating. However, after another week of falling ~5%, analyst Benjamin Cowen believes we may be on the verge of breaking this trend.
Bitcoin (BTC), monthly graph, source: CoinMarketCap
Week 41 of Cycle Set to Repeat? Cowen Thinks Yes
Cowen’s analysis observes that BTC is down approximately 16% from its cycle high set about four weeks ago. But more importantly, when looking at a chart of Bitcoin paired with the rest of the altcoin market, Cowen identifies that week 41 is a major historic factor. In 2017-18’s bull cycle, it was week 41 where BTC broke out of its consolidation phase and plummeted downward into a multi-year bear market. At the time of posting his tweet, BTC is flirting with the bottom of its consolidation range while also entering the 41st week of its current cycle.
After setting the range low last cycle, #ALT / #BTC pairs broke down 41 weeks later.
This is week 41.
People are blaming it on a black swan, but it is a carbon copy of last cycle. pic.twitter.com/OPm6XvVBfV
— Benjamin Cowen (@intocryptoverse) April 13, 2024
Much of Cowen’s fear is due to the breakthrough in the BTC/ALT chart, where the ratio of Bitcoin to the rest of the market finally fell below the well-established support level. However, he believes that the biggest impact won’t be felt by Bitcoin (although he does predict a fall) – but rather, by altcoins.
In some ways, this could be a good thing. As Cowen suggests, the market is filled with scams and projects without utility that have been pumped over the past couple of months. One only needs to look at the performance of some prominent memecoins to recognise a deflation may be beneficial in the long term.
With #BTC dominance breaking out, it means the party is likely over for altcoins for a while.
The cleanse is needed. There are too many scams. Only the stronger ones will survive.
Hopefully all the long BTC dominance videos were helpful! pic.twitter.com/dMNmkorR1E
— Benjamin Cowen (@intocryptoverse) April 13, 2024
However, not everyone is concerned about a potential correction. Several commentators suggested it was quite normal for BTC to dip on the eve of halving, as the market settles on how it values the coin given significant changes to its supply.
30% drops are normal right before the halving.
— ~MK~ (@mikexki) April 13, 2024
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The post Bitcoin Analyst Ben Cowen Reveals Why the Current Market Drop Could Develop into Something Bigger appeared first on Crypto News Australia.
Filed under: Bitcoin - @ April 15, 2024 6:10 am