renowned crypto analyst Benjamin Cowen has provided a cautionary assessment regarding Bitcoin’s price trajectory, highlighting a crucial support level that investors should monitor. According to Cowen, if Bitcoin (BTC) fails to sustain its position above $83,000, it may face a potential decline, sliding into the mid-$70,000 range.
In a recent analysis released on his YouTube channel, Cowen emphasized the importance of Bitcoin’s bull market support band. Despite recent corrections observed among other major financial assets, he noted that Bitcoin has yet to face a significant pullback in this area.
Cowen pointed out that while the Nasdaq index has experienced a retreat towards its bull market support band, the S&P 500 is nearing this region as well. He also mentioned that cryptocurrency market indices, TOTAL2 and TOTAL3, which exclude Bitcoin and Ethereum, have tested their 21-week exponential moving averages (EMA).
Vital Support Level: $83,000
With Bitcoin’s recent decline below $83,000, Cowen urged a reevaluation of the technical landscape. He indicated that a daily close beneath Bitcoin’s 50-day moving average would signal the first major indication of a retreat toward the 21-week EMA. He identified the significant support zone as lying between the early and mid-$70,000s, stating:
“If we lose the $83,000 level, the next significant stop will be the bull market support band. This corresponds to the early to mid-$70,000 range. Below that, a retest of the lows of the previous sideways movement range would come into play.”
Cowen stressed that if Bitcoin were to remain below $83,000 for a second consecutive week, it would complicate the bullish outlook. For buyer momentum to recover after such a development, it would be imperative for Bitcoin to hold its bull market support band.
Caution Against Misleading Price Movements
In his analysis, Cowen also reflected on historical bear markets in Bitcoin’s past, noting that price peaks established without substantial enthusiasm can result in various outcomes. He highlighted that these peaks might lead to brief bear markets, like the one experienced in 2019, or prolonged downturns marked by temporary upward movements that could mislead investors.
He cautioned against potential false breakouts, referencing previous instances in 2015 and 2022, indicating that such risks should not be dismissed in the current market landscape. While the short-term outlook is not entirely pessimistic, Cowen mentioned that prevailing macroeconomic conditions complicate Bitcoin’s upward momentum.
Furthermore, he indicated that any corrections in the U.S. stock market could negatively affect Bitcoin’s price, stressing the importance of monitoring market developments particularly as the U.S. midterm elections approach on November 3rd.
This article is for informational purposes only and not investment advice.
