Although Ethereum has been in a bear market for the past 30 days, there is a chance that it will hit its low point soon. A well-known crypto analyst has expressed concern over the performance of Ethereum (ETH) compared to that of Bitcoin (BTC), speculating that a major event could trigger a major drop.
What’s behind this bearish outlook and what should altcoin investors do now? Let’s dive in.
Expect a 50% drop if this happens. says Cowen
While most altcoins are expected to fall by 40-50% against Bitcoin, ETH is no exception. During an exclusive interview with Crypto Banter’s Ran Neuner, Benjamin Cowen raised the possibility of a more than 50% drop in the ETH/BTC pair from its current value of 0.063 BTC (approximately $1,828). But why is this dark projection made?
This perspective came as he believes a bearish double top pattern is forming on the monthly chart for the ETH/BTC pair. It should be noted that this pattern indicates that Ethereum holders may be taking advantage of rallies to exchange their ETH holdings for BTC.
For him, this isn’t just a trend, Cowen said, it looks like the current phase in the ETH/BTC market is really a big distribution period, similar to the one we saw in the previous cycle, where there was an initial pump . , followed by a sell-off and then a distribution phase. We believe that the ETH/BTC pair is at a critical juncture where a breakout to the negative is likely.
Historical patterns are also bleak, what is the catalyst?
He correlated his point of view with historical patterns. His analysis suggests historical trends, with the ETH/BTC pair typically experiencing declines during the months of June through December. Although there will be a potential drop to as little as 0.03 BTC (equivalent to $871), reflecting a drop of more than 52% from its current value.
His forecast also included the further possibility of a stock market retracement as a catalyst for this significant decline. Cowen recalled a similar scenario in late 2017, in which the Ether/Bitcoin pair experienced a decline.
However, it was a subsequent decline in 2018 that marked the end of a period of reckoning for several altcoins. However, based on this data, Cowen predicted that a similar trend could reoccur, this time possibly led by a seasonal decline in the S&P 500.
That said, those who have put a lot of money into altcoins will run into a real and pressing problem if the predicted 40-50% loss occurs before a recovery.
In conclusion, Cowen’s analysis highlights the potential for a substantial decline in Ethereum’s value compared to Bitcoin, with a specific focus on the ETH/BTC pair. However, it is important to note that the cryptocurrency market is highly volatile and subject to various factors that can affect price movements.