In a recent X post, Benjamin Cowen chimed into Bitcoin dominance, explaining its significance in the crypto market.
In the coming weeks, Bitcoin must decide whether to rise above its Bull Market Support Band (BMSB) or it will continue to face resistance. Cowen noted that Bitcoin is sliding below its BMSB in the summer of 2024. However, this pattern isn’t new; similar trends have been observed in previous years. For instance, Bitcoin dropped below its BMSB in August 2023, remained there for weeks, and rallied strongly in Q4.
Connecting the Historical Dots
Cowen draws a parallel between Bitcoin’s performance in 2013 and 2024, noting that BTC found a local low on July 5th in both years. He suggests that if Bitcoin follows a similar pattern to 2013, it could experience a “left-translated peak,” BTC quickly reclaims the Bull Market Support Band (BMSB) and holds it as support over the next 1-2 months, leading to a rally in Q4.
Historically, Bitcoin tends to peak in Q4 of the post-halving year, which for the current cycle would be 2025. But Bitcoin might take longer to reclaim its BMSB, suggesting a slower but steady climb toward its peak.
Crypto Impact
Cowen predicts a strong rally in Bitcoin dominance in Q4, potentially peaking around 60%. He argues that Bitcoin, being lower risk than other cryptocurrencies, will likely provide better returns than most altcoins until the Federal Reserve pivots. This perspective highlights Bitcoin’s role as a safer and more reliable investment in the current market environment.
Technical Indicators
He further highlights the critical level of Bitcoin’s 2-week Relative Strength Index (RSI). This level will help determine whether Bitcoin follows the patterns of 2013 and 2016, where it found support around these levels, or 2019, where it fell through and experienced an intermediate downtrend within a larger uptrend. This analysis provides a technical framework for understanding Bitcoin’s potential paths.
Market Sentiment and Altcoin Behavior
Responding to Cowen, Zia ul Haque agrees with the Q4 rally prediction but expresses skepticism about Bitcoin’s dominance exceeding 58%. He points out that as each cycle progresses, more money gets locked into altcoins, with many investors holding onto them despite market fluctuations. According to Haque, this dynamic could soon lead to a bottoming out of altcoins.
What’s Next for BTC?
In short, Cowen believes Bitcoin’s future in Q4 2024 depends on whether it can rise above the Bull Market Support Band (BMSB). If it follows patterns from 2013, 2016, and 2023, Bitcoin might see a strong recovery and rally. However, if it follows the 2019 trend, it could continue to struggle. As we move through the summer, we will focus on Bitcoin’s ability to overcome its current resistance and the factors influencing its path in the coming months.
Do you think Q4 will change crypto assets or will the year-end bloodbath continue? It will be revealed soon, stay tuned!
