Bitcoin mid-cycle top? According to Benjamin Cowen, an indicator suggests that BTC is headed for a downtrend
Well-known crypto analyst Benjamin Cowen says an indicator suggests Bitcoin (BTC) may be entering a downtrend.
In a new strategy session, Cowen tells his 789,000 YouTube subscribers that the extension of the 20-week simple moving average (SMA) indicates a bearish trend for Bitcoin.
According to Cowen, the indicator shows that Bitcoin may have reached a mid-cycle peak.
“The last three highs, the last three highs that marked a local top, at least for a while, occurred around the time the 20-week extension occurred [SMA] reached this level [of about 40%]. That’s why I still think it’s important to look at this level.”
Source: Benjamin Cowen/YouTube
Zooming out on the picture, the analyst says Bitcoin tends to form cycle tops when the extension of the 20-week SMA touches its diagonal resistance.
The analyst shares a chart showing BTC reached a mid-cycle peak in 2019 as the indicator approached its diagonal resistance. Cowen says history could repeat itself as the extension of the 20-week SMA is currently hovering near long-term diagonal resistance.
“One of the things I like about this chart in the longer term is that when you're in peak bull mania mode, the extension from the 20-week SMA tends to bring that decreasing volatility aspect, with the first cycle being the extension from the 20-week SMA. weekly SMA much more significant. But as we move from one cycle to the next, the extension is no longer as great. Now, in a sense, the question is: Will we try it again this cycle?
It's possible, but you can see that there was no mid-cycle peak in 2019. We were reasonably close, but didn't even hit it. And in fact, this expansion is far beyond where we are currently. You can see that the peak extensions, when achieved, tend to correspond to much more significant peaks, such as all-time highs over a long period of time. The question arises as to whether this is up here [around June 2019] or is this here? [in January 2024] a mid-cycle top?”
Source: Benjamin Cowen/YouTube
At the time of writing, Bitcoin is trading at $39,365, down slightly in the last 24 hours.
I
Don't miss a thing – Subscribe to receive email alerts straight to your inbox
Check price action
Follow us on Twitter, Facebook and Telegram
Surf the Daily Hodl Mix
Check out the latest headlines
 
Disclaimer: Opinions expressed on The Daily Hodl do not constitute investment advice. Investors should conduct their due diligence before making any risky investments in Bitcoin, cryptocurrencies or digital assets. Please note that your transfers and transactions are at your own risk and any losses you incur are your responsibility. The Daily Hodl does not recommend the purchase or sale of cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl is involved in affiliate marketing.
Generated image: Midjourney
Learn Crypto Trading, Yield Farms, Income strategies and more at CrytoAnswers
https://nov.link/cryptoanswers
Comments are closed.