A widely followed analyst, Benjamin Cowen, has issued a warning to traders about Bitcoin, stating that history suggests the king crypto is at a high risk of correction. Cowen points out that during the first half of pre-halving years, Bitcoin tends to break through its bull market support band but then quickly dips below it in the third quarter. This pattern has been observed in 2011, 2015, and 2019.
The bull market support band, as described by Cowen, consists of the 20-week exponential moving average (EMA) and the 21-week simple moving average (SMA). The fact that Bitcoin has historically followed this pattern raises concerns that it may repeat itself in the current market cycle.
Interestingly, Cowen suggests that this potential correction could also affect other digital assets, such as Ethereum. He notes that Ethereum and other leading smart contract platforms are already moving below their bull market support bands. This correlation indicates that a correction in Bitcoin could have a cascading effect on the broader cryptocurrency market.
At the time of writing, Bitcoin is trading at $29,331, while Ethereum is priced at $1,861. These levels indicate that both cryptocurrencies are currently below their respective bull market support bands, further supporting Cowen’s analysis.
It is important to note that cryptocurrency markets are highly volatile and subject to various factors that can impact their value. While history may provide insights into potential market movements, it is not a guarantee of future performance. Traders and investors should exercise caution and consider their risk tolerance before making any investment decisions.
As Bitcoin and other cryptocurrencies continue to gain mainstream attention, market participants closely monitor market indicators and expert analysis to navigate the ever-changing landscape. Cowen’s warning serves as a reminder for traders to stay vigilant and remain informed about potential risks in the market.
Benjamin Cowen, a well-known analyst, has raised concerns about Bitcoin being at high risk of correction based on historical patterns. His observation of Bitcoin breaking through its bull market support band during the first half of pre-halving years and subsequently dipping below it in the third quarter is supported by examples from 2011, 2015, and 2019. The potential correction in Bitcoin could also impact other digital assets like Ethereum, as they are already moving below their bull market support bands. However, it is essential to remember that the cryptocurrency market is highly volatile, and past performance does not guarantee future results. Traders and investors should exercise caution and stay informed to make well-informed decisions in this ever-evolving market.