Popular crypto analyst Benjamin Cowen thinks Bitcoin (BTC) could still witness another sell-off event en route to printing a fresh bear market low.
In a new YouTube video, Cowen tells his 770,000 subscribers that Bitcoin’s one-year running return on investment (ROI) indicator suggests that BTC could be headed for a capitulation event.
“Historically, [Bitcoin’s one-year ROI] bottoms at about 0.2. The best way for it to bottom at 0.2 would be for it to go down to the $13,000-$14,000 range some time in the next month or two. And then it would probably hit around that 0.2 level, because we’re comparing it to $69,000, and 20% of around $69,000 or at least where the daily close was gets you to around that $13,000-$14,000 level.”
Looking at the analyst’s chart, Bitcoin tends to print a bear market bottom whenever the running one-year ROI metric hits 0.2.
Should Bitcoin holders capitulate, Cowen predicts that BTC will whipsaw panic sellers by pulling off an abrupt and strong rally once the bottom is in.
“If we do see some type of capitulation, we would see some type of strong rally after it because, all things considered, this would have been the typical bottom for Bitcoin. You go sideways at about 70% down for months and months and months… and then eventually you see final capitulation. This would be your typical bear market bottom for Bitcoin.”
Bitcoin is trading at $19,585 at time of writing. A correction to Cowen’s target of $14,000 suggests a downside potential of nearly 30% for BTC.
Don't Miss a Beat – Subscribe to get email alerts delivered directly to your inboxFeatured Image: Shutterstock/Ruslan Grumble/PurpleRender