The cryptocurrency market has become an increasingly important area in the financial world. Especially the values of leading cryptocurrencies such as Bitcoin arouse great interest and curiosity among investors and analysts. However, in addition to this interest and curiosity, the volatility of the market and sudden price fluctuations constantly make investors nervous.
Recently, Benjamin Cowen, one of the leading analysts of the cryptocurrency market, claimed that Bitcoin could face a heartbreaking correction. In a new video update, Cowen stated that Bitcoin tends to retest previous macro resistance levels before climbing higher. This means that there may be a serious decrease in the value of Bitcoin.
According to Cowen, although Bitcoin recently rallied above $60,000, it did not retest the $30,000 level, using that level as support. This makes a 50% drop in the value of BTC possible. This analysis has caused concern among many investors because the cryptocurrency market presents an environment full of rapid and sharp price changes.
“Even people who like to use the 2016 analog, remember that once it breaks through these ranges, Bitcoin will come back and test it as support. The problem now is that in this range of $30,000 [mevcut seviyelerden] decrease means a decrease of approximately 50%. “What we got in 2019 was exactly a 50% drop.”
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Additionally, according to Cowen, Bitcoin’s current rally looks unsustainable as the cryptocurrency moves higher without establishing any solid support base. Cowen’s analysis reflects the general trend in the market, indicating that Bitcoin is currently potentially overvalued.
Typically in long bull markets, asset prices prefer to test previous levels as support after breaking out, according to Cowen. However, he points out that Bitcoin has not established this type of support recently. This could mean that the price of the cryptocurrency could fall below current levels.
“I think the problem is that Bitcoin doesn’t really create any real support. A lot of times when you have these long bull markets, markets like to test previous levels as support after they break out. “When it gets to a point where it no longer tests it as support and it reaches those highs, that’s when you get nasty bear market corrections.”
Bitcoin is trading at $65,152, up about 4.69% at press time.
Considering Bitcoin’s past performance, we see that the market is quite sensitive to fluctuations and sudden price changes. Therefore, Cowen’s analysis serves as a warning that investors should proceed with caution and remain cautious about the sustainability of the current rally.
You can follow the current price movement here.
