Cowen Warns Of Altcoin Market Crash, If Bitcoin Falls Further Down
According to a leading crypto analyst Benjamin Cowen Bitcoin’s (BTC) historical performance indicates that investing in altcoins right now remains risky.
In a recent YouTube video update, the analyst shared with his 729K subscribers that BTC’s price movement in 2018 gives an indication of what could happen to the altcoin market assuming that Bitcoin continues to go further down.
“We need to look at what has happened in the past and say if we put in a lower low, what happens? The altcoin market against the Bitcoin market changes. The best way to understand that is by looking at Bitcoin dominance.
The dominance right now is at the exact same level it was at in June of 2018, the exact same level and then the dominance shot up… What happened in June of 2018? That’s where Bitcoin puts in a lower low.”
According to Cowen altcoin prices could fundamentally change, if BTC prints a lower low, which has a very high risk of happening, he warns.
“We don’t know yet if Bitcoin’s gonna put in a lower low but I would say there is a risk of it happening, a very high risk of it happening. If Bitcoin puts in a lower low, the structure of the market changes completely. The reason is because the bulls can no longer hold on to the thesis that it is still a bull market because we’re putting in higher lows.
Then the bulls have to give some ground and say it’s just a long sideways phase. Again, they could be right and it could play out to be like that, but at least the argument of it being a bull market could be over in the short term.”
Cowen refers to the similarity in Bitcoin chart now and back in 2018, which could project what is incoming for both BTC and the altcoins market.
“If we, in fact, end up putting in a lower low, then we have to go back down and test the bottom of this range just like we had to go back down and test the bottom of the $6k range back in 2018. The way to think about it is the $30k range is a similar type range as your $6k range in 2018.
Over here, the range that we kept going down to was $6k, but over here, you could argue that it’s closer to $30k, basically that same range more or less. You have $6k and $30k. The floor from here to here has gone up 5x, but the structure is still somewhat similar.”
