Cryptocurrency analyst Benjamin Cowen has warned investors about a pattern emerging prior to Bitcoin‘s (BTC) past three halvings. He highlighted the significance of the halving process for BTC and cautioned about potential market movements.
Cowen noted that Bitcoin tends to fall to the bull market support band in the first quarter of a halving year. This band, comprised of the 20-week simple moving average and the 21-week exponential moving average, serves as a potential support level indicator during bull markets.
According to Cowen, Bitcoin could lose double-digit percentage points from its current level if it tags the bull market support band. He mentioned a possible significant drop of around 15% from current levels.
Cowen also stated that whether the bull market support band acts as a support level or if BTC falls below it could depend on the state of the U.S. economy. He referenced past halvings in 2012 and 2016, where the support band held, but not in 2020 due to the pandemic-induced recession and unemployment spike.
In conclusion, the crypto analyst suggests that Bitcoin may repeat a pattern observed in previous halving periods, warning of a risk of double-digit percentage losses if it tags the bull market support band, with the outcome being contingent on the health of the U.S. economy.