Cowen stated that Bitcoin’s relative resilience so far demonstrates its strength in the market, arguing that this also explains the rise in Bitcoin dominance. The analyst believes that expectations of tightening monetary policy could shift investors from altcoins to relatively lower-risk crypto assets like Bitcoin.
Critical Level for Bitcoin: $83,000
Cowen said that the technical outlook needs to be evaluated more carefully after Bitcoin fell back below $83,000.
According to the analyst, a daily close below Bitcoin’s 50-day moving average would be the first significant signal of a pullback towards the 21-week EMA.
Cowen stated that the support zone in question is between the beginning and the middle of $70,000, and offered the following assessment:
“If we lose the $83,000 level, the next significant stop will be the bull market support band. This corresponds to the early to mid-$70,000 range. Below that, a retest of the lows of the previous sideways movement range would come into play.”
The renowned analyst also stated that defending the bullish scenario would become difficult if Bitcoin were to close below $83,000 for a second week. He added that for buyers to regain strength following such a development, the bull market support band would need to be maintained.
Cowen Warns of False Price Rise
Cowen also touched upon some past bear markets in the Bitcoin market, noting that peaks formed without strong enthusiasm can lead to different outcomes.
According to the analyst, such peaks are sometimes followed by shorter bear markets similar to the one in 2019, while other times longer periods of decline occur with upward movements that mislead investors.
Cowen, pointing to the fraudulent breakouts seen particularly in 2015 and 2022, argued that a similar risk should not be ignored in the current market.
On the other hand, the analyst stated that Bitcoin’s technical outlook is not entirely negative, but macroeconomic conditions are making the rise more difficult.
Cowen stated that a potential correction in the US stock market could also drag Bitcoin down, adding that price movements before and after the US midterm elections on November 3rd should be closely monitored.
*This is not investment advice.
