Closely watched analyst Benjamin Cowen says Ethereum may be in the midst of a repeat of a historical pattern that could take ETH to much lower levels.
In a new strategy session, Cowen tells his 790,000 YouTube subscribers that Ethereum only bottomed in the last crypto bear market after neutralizing an earlier breakout from a rising wedge and then retesting a macro low.
He also notes that ETH crashed immediately after the Ethereum/Bitcoin (ETH/BTC) pair broke.
With ETH/BTC teetering on support, Cowen says the next downturn could lead to a decline for ETH/USD, which he believes could leave Ethereum trading at the $1,200 level.
“Not only was it the process of undoing the yield curve, but it was also the disintegration of the ETH/BTC valuation.
If you look at the ETH/BTC valuation, you will notice that it was right here in July 2019 when ETH/BTC went bankrupt. And in July 2019, ETH/USD started falling there [from $362.39]and that’s where ETH/USD went back through this wedge and back all the way back here ($118).
In fact, you’ll notice that this low that ETH set in December 2019 was actually slightly above this higher low [at $95]. This higher low here [November 2022] turned out to be around $1,000, so if it played out in a similar fashion – which may very well not be the case – it would mean going back and testing at that low level.
But again, you’ll notice that this drop only happened after the ETH/BTC valuation collapsed. It was after ETH/BTC went bankrupt that ETH/USD finally had this drop. And where are we today? We are about to see a similar process take place.”
At the time of writing, ETH/BTC is trading at 0.05581 BTC ($2,927), still above Cowen’s support at 0.049 BTC ($2,570).
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Generated image: Midjourney