A widely followed crypto analyst says that gold may just have signaled the local top of Bitcoin’s (BTC) recent strength.
In a new video update, crypto strategist Benjamin Cowen tells his 800,000 YouTube subscribers that if gold continues to do well, the top crypto asset by market cap may be in for a an extended correction
“At least so far, you can see that the breakout of gold in 2019 marked the top locally for Bitcoin. Bitcoin did go higher obviously a year later. But even [this year], you can see gold broke out right when Bitcoin/USD found that local top in March.
So that’s one thing – if gold continues to do well, the implication of that could be that Bitcoin is actually going to fall after the consolidation below the 8-week [moving average] rather than get a pop-up like last year.”
Cowen goes on to say that the breakdown of Ethereum (ETH) against BTC (ETH/BTC) has also correlated with Bitcoin tops, which he notes has already potentially begun.
“The other thing that has already happened is the ETH/BTC breakdown. So if you look at the breakdown of ETH/BTC, you can see that last cycle, once it started to break down, that marked the top by BTC/USD before a larger correction, and you’re kind of looking at something similar [this year].”
ETH/BTC is trading for 0.05143 ($3,258) at time of writing.
The crypto analyst then says that altcoins bleeding out against BTC would be another sign of a Bitcoin top, but that has yet to happen this time around, according to him.
“When [altcoins] broke down [last cycle], that marked the local top for Bitcoin. And Bitcoin still got some pretty nice rallies as altcoins bled against Bitcoin. That hasn’t happened yet. Altcoins did get a lick below it but not durable weekly closes below it.
So it’s not crystal clear as to which way Bitcoin is ultimately going to break. My best guess as to what happens is that it’s going to basically bounce around [between $66,000 and $56,000]… I would say it’s going to spend a lot of time, over the next few weeks, between the 8-week SMA and the bull market support band.”
Bitcoin is trading for $63,386 at time of writing, a 1.2% decrease during the last 24 hours. At the start of 2024, it was moving for about $44,000.
Generated Image: Midjourney