A widely followed crypto analyst is outlining what he believes could be the worst-case scenarios for the leading two digital assets.
In a new interview on the Altcoin Daily YouTube channel, crypto strategist Benjamin Cowen says that macroeconomic headwinds could drive Bitcoin (BTC) and Ethereum (ETH) to fresh bear market lows.
Looking at Ethereum first, Cowen predicts that ETH could lose as much as 65% of its value from its current price of $1,175.
“The worst case scenario would be dependent on how bad this potential recession ends up being. It’s hard to know exactly how that’s going to affect crypto, but I would say for Ethereum, the main levels I’m watching are the $400-$600 range.
I don’t know if it’s going to go all the way down to $400, but I do think a $600 ETH is potentially in the cards mainly because I think there’s a lot of evidence to suggest that it’s about one cycle behind Bitcoin in terms of volatility.
[ETH’s] first cycle [was] a solid 95% bear market and Bitcoin’s first bear market was 94%. Bitcoin’s second bear market was around 87% so if Ethereum goes down 87% from its all-time high this time, or even 88%, that’s gonna put it at just below $600, so I think there’s a case to be made that Ethereum could have this final capitulation down into the $400-$600 range.”
The popular analyst goes on to present what he feels could be the worst-case scenario for the top crypto asset by market cap, adding that he doesn’t think it will be hit as hard as altcoins.
“I don’t think [Bitcoin] has to drop nearly as much as some of these altcoins to actually [find] its bottom… The main indicators that I’m still looking at that it [still] needs to trigger are things like Bitcoin normally has a daily close below its balanced price.
Right now, the balanced price is right at $15,000 so that would tend to make me think that we need to go below $15,000 at some point.”
Bitcoin’s balanced price is a model that attempts to capture the fair value of the king crypto by measuring the difference between BTC’s realized price and transferred price.
BTC is changing hands for $16,154 at time of writing, down 2.54% in the last 24 hours.
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Source: https://dailyhodl.com/2022/11/28/heres-the-worst-case-scenario-for-bitcoin-btc-and-ethereum-eth-according-to-analyst-benjamin-cowen/