Here’s what could signal a trend reversal in Bitcoin (BTC) over the next year, according to analyst Benjamin Cowen
So says the popular cryptanalyst Benjamin Cowen Bitcoin (BTC) holders should be on the lookout for a signal that could mark the end of the king crypto’s extended bear market.
In a new video, Cowen shares with his 779,000 YouTube subscribers that Bitcoin’s current percentage drop from its all-time high is nearing levels that signaled the bottom of the 2018 and 2014 bear markets.
“Bitcoin is kind of in that 75% range below the all-time high, so it’s kind of in between. It’s not at the level of last summer, but it’s not as far down as it has been in the past either…
If the months roll by and you see that the percentage pullback from the all-time high for bitcoin really lines up with what you’ve seen in previous bear markets, that would at least be a sign that things might finally turn around.”
Credit: Benjamin Cowen/YouTube
Bitcoin fell by over 80% from its all-time high during the 2014 and 2018 bear markets before bottoming, according to the analyst’s chart. At the time of writing, BTC is down 75.6% from its record high set in November of last year.
The analyst is also closely watching the percentage drop in total market capitalization (TMC) from the all-time high. According to Cowen, the market cap of all crypto assets is currently 72% below its all-time high, which is still a few percentage points away from the TMC drawdowns seen during the last two bear markets.
The analyst says the difference in TMC drawdowns suggests altcoins could do so have more downside if history repeats itself.
“In the last cycle, total market cap declined about 87%. The cycle before that was only down about 78%, but that was also when it was mostly just Bitcoin.
This discrepancy of 72% to 88% [TMC percentage drawdown from all-time high] compared to 75% to 85% [BTC drawdown from all-time high] or so is one of the factors helping to consider why Bitcoin’s dominance is still poised to make a sustained move higher. It’s the fact that the altcoin market still has a sizeable bottom that it could easily give up.”
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