Bitcoin (CRYPTO: BTC) now matches the pattern of every past bear market bottom, according to Benjamin Cowen, one of this cycle’s most prominent bears.
Why the Burden of Proof Moved to the Bears
Cowen, founder of Into The Cryptoverse, said in a Real Vision interview Sunday that past bear markets ended with the same three steps:
- Price sets a low and rallies
- It climbs above the 20-week moving average
- It breaks the 50-week moving average and keeps going
Bitcoin has now completed all three, and Cowen can’t recall a Bitcoin rally with this setup ever failing.
Silver’s 2011 breakout did reverse the next day, but Bitcoin has held its gains so far. That shifts the burden of proof, in his view, onto the bears to explain why price would fall back.
Why He Is Not Fighting the Move
Cowen had bet that Bitcoin would stay below its May high this year, and the rally past that level proved him wrong.
He says he would rather admit the miss than argue the breakout is fake. “I’d rather just kind of sit back and say, ‘All right, like I’m wrong,'” Cowen told Real Vision.
As Benzinga reported, Cowen first conceded after Bitcoin cleared $85,000. His mistake, he now argues, was assuming Fed rate hikes would push Bitcoin lower, since a hike can also signal a healthy economy.
What Could Still Trigger a Pullback
Cowen sees a stock market correction as the main threat to Bitcoin. In the last few midterm years, stocks began sliding in late September, and a similar drop this time could drag crypto lower.
Even so, he does not expect a retreat from the $85,000 to $90,000 range to produce a new cycle low, because Bitcoin would still sit well above its prior bottom.
This cycle’s low also came in July, earlier than any in the past, when bottoms typically landed in the fourth quarter and once in the first.
Why Rates May Peak Before Mid-November
On his own channel Monday, Cowen said the 10-year Treasury yield, already at 5.3%, will likely top before mid-November, as it did in the last two midterm years.
Odds of an October Fed hike have dropped from 64% to 17.7% in a week, which Cowen reads as bond traders worrying that the Fed is falling behind on inflation.
He sees the October 28 Fed meeting as the possible point of peak fear, with yields falling after the midterms.
For crypto, falling yields would ease one of the biggest pressures on risk assets and could give Bitcoin’s rally more room to run.
Read Also: Will Bitcoin, ETH, SOL See a ‘Sunday Pump, Monday Dump?’ One Analyst’s Indicators Say Yes
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