Widely followed crypto analyst Benjamin Cowen is updating his outlook for Ethereum (ETH) for the second half of the year as Bitcoin (BTC) enters the $30,000 level.
In a new strategy session, Cowen tells his 785,000 YouTube subscribers that Ethereum may dip lower before seeing new all-time highs.
He says that during the years when the crypto market is in a recovery phase, Bitcoin outperforms altcoins. He also warns that if the king crypto moves to the downside altcoins could collapse at a much quicker rate.
“The recovery years can still be brutal for the altcoin market in general. And so when we think about looking at the period that’s sort of the phase of the year where we go up, the phase of the year where we go down, we must remember that Bitcoin tends to outperform a majority of the altcoin market during the recovery year.
I don’t really consider ETH an alt, but just if you are trying to think about it in terms of how will the altcoin market, in general, perform with respect to Bitcoin, the altcoin market can still very much go down, even when Bitcoin goes down, and it can go quicker to the downside than Bitcoin.”
Cowen says he does not believe the crypto markets will fully recover and reach new all-time highs until the Federal Reserve stops raising interest rates to lower inflation and starts quantitive easing (QE), which is when the Fed injects liquidity into the markets such as by buying bonds.
“So this is just something I think that people should think about when thinking about how will Ethereum likely perform in the latter half of the year. My guess is that you’re going to see another move back to the downside before you get a sustained move to the upside.
The reality is, I don’t really see a sustained move to new highs coming until we get back to a period of QE. And until we get back to that point, I do think these moves will eventually be faded. I know it’s quite volatile. We’ve been back and forth between $1,000 and $2,000 quite a bit here over the last half year or so.
But it is important to remember that for the altcoin market during the recovery year for Bitcoin, the hype can die down a lot quicker than it did for Bitcoin. And you’re also seeing that reflected as the dominance of Bitcoin continues to slowly push higher.”
Ethereum is trading for $1,896 at time of writing, up 0.3% in the past 24 hours.
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