Benjamin Cowen, a well-known analyst in the cryptocurrency market, assessed Bitcoin’s (BTC) current state and his expectations for the remainder of the year in his latest analysis. Cowen note
Benjamin Cowen, a well-known analyst in the cryptocurrency market, assessed Bitcoin’s (BTC) current state and his expectations for the remainder of the year in his latest analysis.
Cowen noted that Bitcoin managed to close last week above the 200-week moving average (200EMA), stating that this is a positive signal showing that the bulls have not yet given up. He said it was not surprising that the local lows seen in February were retested in June, and reiterated his expectation of a bottom formation within June. However, he added that it is still too early to say whether the current level is the definitive bottom.
Cowen noted that Bitcoin’s current price movements bear a strong resemblance to the bear market periods of 2018 and 2022.
In 2018, Bitcoin also bottomed out in February, then rallied towards a bear market resistance band, and tested an even lower low in June. According to the analyst, after a bottom is reached in June, market volatility typically decreases significantly during the summer months, and trading volumes drop.
Looking at historical ROI (Return on Investment) data, Cowen noted that July typically closes in the “green,” following declines in May and June.
The analyst, giving examples from his own strategy, recalled that in past cycles (2018 and 2022) he started gradual buying (DCA) after the June low, but in both cycles the market truly bottomed out with a final sharp decline in the last quarter of the year (Q4). Cowen predicts that a similar scenario could occur this year, with the final bottom being seen in Q4.
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Cowen, stating that predicting short-term price movements is nearly impossible, argued that a gradual buying (DCA) strategy makes sense in the later stages of bear markets. The analyst said that investors lost liquidity by buying at the top and panicking at the bottom during the false rallies in the first half of the year, and added:
“Historically, my most successful strategy has always been to ignore Bitcoin in the first half of the year and start incremental purchases (DCA) in the second half. Even if the market goes down in Q4, it’s very difficult to catch the dips by placing orders on exchanges; because those dips usually happen when you’re not in front of your screen, in the flow of daily life, and they recover quickly.”
The analyst added that if Bitcoin continues to hold above the 200-week moving average in the next 1-2 weeks, the likelihood of seeing a rebound towards the bear market resistance band in July will significantly increase.
*This is not investment advice.
Continue Reading: Analyst: “The Bulls Haven’t Given Up Yet on Bitcoin” – Assesses the Current Situation
