The CoinSpeech team dives into Benjamin Cowen’s recent analysis of the Bitcoin market, focusing on crucial aspects such as the bull market support band, Bitcoin dominance, and the ongoing devaluation of altcoins. Below, you can watch Benjamin Cowen’s new video for the complete breakdown.
Understanding the Bull Market Support Band
Benjamin Cowen starts his discussion by updating viewers on the current status of the bull market support band, which comprises the 20-week SMA (currently just over $63,000) and the 21-week EMA (just over $61,000). The significance of these levels is critical: “as long as we stay above that, the market structure is not yet broken.”
This foundational element forms the basis of Cowen’s broader discussion about market trends and investor sentiment.
The Altcoin’s Struggle Against Bitcoin Dominance
One of Cowen’s primary points is the ongoing devaluation of altcoins relative to Bitcoin. He notes that “there is this element of the devaluation of altcoins causing their purchasing power to not be as high when going and buying Bitcoin.” This trend isn’t new; it also occurred in 2019 when altcoins showed significant weakness against Bitcoin.
He emphasizes that the chart for Bitcoin dominance reflects this shift clearly: “Bitcoin dominance just goes up as it takes more and more market share and more and more altcoins bleed back to the king.”
Monetary Policy and Market Manipulation
Cowen also discusses how monetary policy impacts market behavior. He points out the FED’s decisions in 2019 and how similar policies today are affecting Bitcoin and altcoins. Highlighting an often overlooked perspective, he states, “the rate cuts are getting pushed further and further out. Altcoins are screaming that they need help, but they’re not getting it from the FED and now keep on bleeding back down.”
Spot ETFs and Altcoin-to-Bitcoin Conversion
Cowen critically examines the influence of spot ETFs. He mentions, “spot ETF flows are putting in new highs,” yet Bitcoin USD isn’t mirroring this success. The reason, he suggests, is the ongoing trend of converting altcoins to Bitcoin. This conversion, he believes, is diluting the potential high for Bitcoin USD, as highlighted by his assertion, “the purchasing power of your altcoin to buy Bitcoin is a lot less today than it was one year ago.”
Speculative Narratives and Market Realities
Addressing various speculative narratives surrounding market manipulation, Cowen argues, “in my opinion, that is cope.” He contrasts this with actual market dynamics, pointing out that the devaluation of altcoins is a more plausible explanation for Bitcoin’s performance.
Bitcoin’s Potential Paths
Cowen delves into the possible future trajectories of Bitcoin. He outlines scenarios where Bitcoin could either rise to new highs or fall back to the bull market support band. His remarks, “if Bitcoin does not sort of get back above 70k, then you simply just run the risk of going back down to the range lows,” serve as a cautionary reminder of the volatile nature of cryptocurrency markets.
In summary, Benjamin Cowen offers a thorough analysis of the Bitcoin market, shedding light on the critical factors at play. His examination of Bitcoin dominance and the devaluation of altcoins provides valuable insights for investors navigating the current landscape.