In recent assessments, analyst Benjamin Cowen emphasized the possibility of Bitcoin's price dropping back to 107,635 after reaching a new peak. He referenced current technical indicators and past price fluctuations, suggesting a potential short-term decline in value.
BTC Golden Cross and Historical Examples
Cowen emphasizes that Bitcoin is approaching a technical formation known as a “golden cross” on the daily chart, where the 50-day moving average crosses above the 200-day moving average.
Although this indicator is often seen as a positive market sign, Bitcoin has previously experienced short-term declines after such formations. Cowen highlights that many corrections have occurred following golden cross formations in previous years.
In this context, Cowen recalls that Bitcoin has undergone significant price declines during golden cross phases in 2015, 2019, 2020, and 2021. He notes that the decline in 2015 was a deeper correction and similar moves have been observed in recent years following this formation.
Benjamin Cowen: “When a golden cross forms, we often see a correction. There was a pullback after the golden cross in 2019, 2020, and 2021. The correction was quite deep in 2015.”
Potential Short-Term Scenarios for BTC
The analyst suggests that a correction of 10% to 15% may occur following this formation. Therefore, a new golden cross could lead investors to face a double-digit decline in the short term.
Benjamin Cowen: “When looking at previous golden crosses, we often see a decline of about 10-15%.”
According to Cowen, during this period, investor expectations rise alongside a surge, with predictions of much higher prices being discussed in the short term. However, the pullback that occurs brings balance to the market and limits overly optimistic forecasts. The adjustment after the golden cross may temporarily dampen market excitement.
Benjamin Cowen: “After the golden cross, prices generally rise and investors begin to expect higher levels. However, a pullback follows, bringing market balance.”
Now, we have both good news and bad news. After Cowen's recent prediction, BTC has dropped from its peak following Trump’s latest statement. The bad news is that the decline is not double-digit, indicating the possibility of a deeper correction. If history repeats itself, BTC could drop to the $101,000 range.
Technical analysis indicators and historical price volatility can help investors determine their future strategies. However, it is important to remember that no technical indicator provides guaranteed results. Investors should consider diversifying their portfolios and keeping an eye on market news to predict potential fluctuations.