Bitcoin, the world’s most valuable cryptocurrency, has been experiencing a downward trajectory, according to Benjamin Cowen, an analyst and founder of Into The Cryptoverse. With the coin’s performance over the years as a reference point, Cowen predicts a bleak future for Bitcoin in the coming month of September. In this article, we will delve into Cowen’s analysis and explore the potential outcomes for the cryptocurrency.
BTC Performance in Recent Weeks
Bitcoin is currently trading at approximately $25,860 and has faced significant pressure in the past few weeks. After experiencing a surge of nearly 60% from November 2022 lows, the coin retraced from its peak of around $31,800 in July 2023. In August, bears dominated the market, erasing all the gains made in July and causing Bitcoin to plummet by roughly 20% from its July 203 highs. The scare triggered by losses on August 17 affected the entire market, highlighting the vulnerability of the cryptocurrency.
Cowen’s analysis suggests that September is historically a challenging month for Bitcoin. He points out that in the past two pre-halving years, the coin’s average return for September was -11.71%. While Bitcoin only lost 11.31% in August this year, Cowen believes that the subsequent month will hold even more significant losses. Based on historical trends, he predicts that Bitcoin could potentially drop to $21,400 by the end of September.
Considering Previous Halvings
Taking a slightly more optimistic view, Cowen incorporates the performance of Bitcoin during previous halvings into his analysis. He notes that the average return for the cryptocurrency in September during the last two halvings was -5.66%. If this trend continues, Bitcoin could decline to around $24,400 by the end of September. While this is a slightly better outcome compared to the previous projection, it still suggests a bearish sentiment in the market.
Despite the current challenges, supporters of Bitcoin remain bullish in the medium to long term. They believe that the recent dump experienced on August 17, which pushed the coin to new lows, may be followed by a recovery. The slight bounceback observed in the second half of August and the first week of September has reignited hope among supporters. However, it is important to note that Bitcoin is not yet out of the woods.
Analyzing the daily chart, it is evident that BTC prices remain within the bearish candlestick of August 17, which serves as a crucial indicator of the ongoing price action. Moreover, despite the relatively higher prices, trading volumes remain relatively low. These factors contribute to the cautious sentiment surrounding Bitcoin’s future performance.
Spot Bitcoin Exchange-Traded Fund (ETF)
In hopes of a potential recovery, Bitcoin supporters are eagerly awaiting the approval of a spot Bitcoin Exchange-Traded Fund (ETF) by the Securities and Exchange Commission (SEC). If approved, this derivative product would allow institutions to invest in Bitcoin and potentially drive up demand for the cryptocurrency.
The future of Bitcoin in September appears grim based on Benjamin Cowen’s analysis. With a projected drop to $21,400 by the end of the month, Bitcoin faces significant challenges ahead. However, historical trends also indicate the possibility of a decline to $24,400, providing a slightly more optimistic outlook. The medium to long-term sentiment remains bullish among Bitcoin supporters, but uncertainty still looms over the market. The approval of a spot Bitcoin ETF could potentially stimulate a recovery, but until then, Bitcoin remains vulnerable to market pressures.
Feature image from Canva, Chart from TradingView.