Crypto analyst Benjamin Cowen says that Bitcoin (BTC) has a great probability of printing a big correction quickly primarily based on historic worth 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 transferring common (SMA).
In accordance with Cowen, every time Bitcoin has crossed above its 100-week SMA, BTC tends to return right 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 assist.
“Traditionally, someday round this level within the cycle – and really it’s occurred even later within the cycle as properly – we’ve kind of retested that 100-week transferring common.
It’s simply one thing that we kind of acknowledge that does appear to be one thing that is available in at a part within the cycle. In 2016, we didn’t have a tough touchdown. I assume you could possibly argue that it was a mushy 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 elements of the world the place their economies have been slowing down and I believe there have been some arguments that it might occur in the US. [But] it didn’t, and Bitcoin principally retested that 100-week SMA and continued to maneuver greater. Whereas final cycle, we retested it, obtained a bounce, however then finally fell via.
So I do assume 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 take a look at of that 100-week transferring 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 mushy 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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