According to analyst Benjamin Cowen, the growth momentum of the cryptocurrency market in August may still be strong. In his base scenario, altcoins will continue to rise against Bitcoin for the remainder of the month, but compared to Ethereum, the picture is less consistent.
According to Cowen, altcoins are likely to outperform Bitcoin in August, but they will not be as strong as Ethereum until ETH approaches its peak. It's hard to miss a strong and large breakout on the daily chart of the ETH/USD pair, as the price has surged past the $4,700 level with good trading volume and extended well beyond the main moving averages.
Although the RSI index is clearly in the overbought zone, it also indicates that the market may be running out of steam. On the other hand, Bitcoin has not made a strong breakout above the $121,000 level. The structure of Bitcoin is more tightly controlled, and the RSI is only slightly overbought, despite having surpassed the resistance level. Cowen's argument that ETH remains a stronger asset in the short term and that most altcoins are lagging behind it is reinforced by this relative performance gap.
Cowen warns that a significant BTC price correction may occur in September. According to him, this move could bring Ethereum below its ATH, leading to a larger sell-off wave in altcoins. Considering that September is usually a weak month for cryptocurrencies, with unstable recoveries or deeper pullbacks, this aligns with historical seasonality.
A Few More Weeks for Altcoins
According to the roadmap, he believes that altcoin traders may experience a few more weeks of favorable volatility against Bitcoin. However, if Bitcoin does undergo a significant correction in September, the subsequent market pressure could push alternative coins lower by the end of October or early November, potentially returning to the previous lows before the next long-term bullish rally.
Market sentiment may change in early fall, but August could still be a good time for selective altcoin trades, especially those leveraging the strength of the BTC pair. Given that volatility is expected to remain high as ETH reaches its all-time high and Bitcoin tests breakout strength, risk management is crucial to survive in the coming months.
