Bitcoin
Key metrics to watch this summer
In a recent X publishBenjamin Cowen spoke about Bitcoin’s dominance, explaining its importance in the cryptocurrency market.
For now, the world’s most popular cryptocurrency is at a crossroads. In the coming weeks, a crucial decision awaits: will Bitcoin break out of its current resistance and rise above the Bull Market Support Band (BMSB), or will it remain stuck below?
Analyst Benjamin Cowen highlights a familiar pattern that emerged in the summer of 2024. This is a reference to previous examples.
Historical parallels: 2013 vs. 2024
Drawing a parallel between Bitcoin’s performance in 2013 and 2024, Cowen noted that BTC found a local low on July 5 in both years. He suggests that if Bitcoin follows a similar pattern to 2013, it could experience a “left-shifted peak.” In such a scenario, BTC would quickly reclaim the BMSB and hold it as support for the next 1-2 months, leading to a rally in Q4.
Historically, Bitcoin tends to peak in the fourth quarter of the post-halving year, which for the current cycle would be 2025. However, Bitcoin may take longer to reclaim its BMSB this time around, suggesting a slower but steady climb towards its peak.
Bitcoin Dominance Trends
Cowen predicts a strong rally in Bitcoin dominance in the fourth quarter, potentially peaking around 60%. He argues that Bitcoin, being lower risk than other cryptocurrencies, will likely provide better returns than most altcoins until the Federal Reserve makes a change. This outlook highlights Bitcoin’s role as a safer and more reliable investment in the current market environment.
Technical analysis
Cowen also emphasizes the importance of Bitcoin’s 2-week Relative Strength Index (RSI). This level will help determine whether Bitcoin follows the patterns of 2013 and 2016, where it found support around these levels, or 2019, where it dropped and experienced an intermediate downtrend within a larger uptrend. This analysis provides a technical framework for understanding Bitcoin’s potential paths.
Responding to Cowen, Zia ul Haque agrees with the Q4 rally prediction but expresses skepticism that Bitcoin’s dominance will exceed 58%. He points out that as each cycle progresses, more money gets locked into altcoins, with many investors holding onto them despite market fluctuations. According to Haque, this dynamic could soon lead to an altcoin bottom.
The Road Ahead: Summer and Beyond
In short, Cowen believes that Bitcoin’s future in Q4 2024 depends on its ability to rise above the Bull Market Support Band (BMSB). If it follows the patterns of 2013, 2016, and 2023, Bitcoin could see a strong recovery and rally. However, if it mirrors the 2019 trend, it could continue to struggle.
As we head into the summer, the focus will be on Bitcoin’s ability to break through its current resistance and the factors influencing its path in the coming months.
Will Bitcoin history repeat itself or will we have a surprise in Q4? We will have to wait and see.