Crypto analyst Benjamin Cowen says that Bitcoin (BTC) has an excellent probability of printing a major correction quickly based mostly on historic value motion.
In a brand new technique session, Cowen tells his 788,000 YouTube subscribers that he’s maintaining a tally of Bitcoin’s 100-week easy shifting common (SMA).
In line with Cowen, every time Bitcoin has crossed above its 100-week SMA, BTC tends to return all the way down to retest it earlier than persevering with upward. Since BTC crossed above the 100-week SMA a number of months in the past, Cowen says that there’s a danger to the draw back if historical past is any indication.
The analyst additionally says that the actions of the Federal Reserve may decide whether or not Bitcoin will maintain the 100-week SMA as help.
“Traditionally, someday round this level within the cycle – and truly it’s occurred even later within the cycle as nicely – we’ve form of retested that 100-week shifting common.
It’s simply one thing that we form of acknowledge that does appear to be one thing that is available in at a section within the cycle. In 2016, we didn’t have a tough touchdown. I suppose you possibly can argue that it was a delicate touchdown. We didn’t also have a recession again then however we did have a recession scare the place lots of people thought there was going to be a recession.
We didn’t actually have an inverted yield curve or something like that however there have been different components of the world the place their economies had been slowing down and I believe there have been some arguments that it might occur in the USA. [But] it didn’t, and Bitcoin mainly retested that 100-week SMA and continued to maneuver greater. Whereas final cycle, we retested it, received a bounce, however then in the end fell by means of.
So I do suppose that in some unspecified time in the future, in all probability inside the first few months of 2024, we’ll see some sort of again check of that 100-week shifting common, after which the query of whether or not it holds or not will in all probability be depending on whether or not the Fed achieves a delicate touchdown or, if it’s a tough touchdown just like the final cycle.”
At time of writing, Bitcoin is buying and selling at $42,297, about 36% above its 100-week SMA.
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