Crypto analyst Benjamin Cowen Recently, the impact of the Death Cross indicator was discussed, which has reappeared on the Bitcoin chart. Thanks to this indicator the price level of 62,000 USD has become crucial for Bitcoin to avoid a further price crash.
Cowen noted in a video posted on his YouTube channel that Bitcoin is at risk of falling even further if it fails to hold above $62,000 and enters the Death Cross. Bitcoin had risen to as high as $62,000 after recovering from its price crash below $50,000 on August 5. The Rise to $62,000 brought the Death Crosswhich now threatens lower prices for the flagship crypto.
The Death Cross and its impact on the Bitcoin price
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Therefore, Bitcoin must soon reach the $62,000 mark again and stay above it, otherwise there is a risk of further price declines, with a drop below the psychological level of 60,000 US dollars is already in sight. The crypto analyst particularly drew comparisons to the Death Cross that occurred in 2019 to provide insights into Bitcoin’s next move.
He noted that the Death Cross in 2019 marked a local top for the flagship cryptocurrency, as it posted lower highs afterward and its price declined for about four months after that. However, Cowen acknowledged that things could be different this time, noting that indicators like these tend to play out “a little differently” at different cycle phases.
The timing of this death cross could also provide insight into what might happen next for Bitcoin. Cowen noted that September, on average, worst month for Bitcoinsuggesting that the flagship cryptocurrency could experience a downtrend that could last into September.
It comes down to the macro side
Cowen explained that whatever happens next for Bitcoin will depend mainly on external factors rather than the prevailing conditions in the crypto market. These include macroeconomic factors such as inflation and the Labour marketIn fact, the macro side is believed to be responsible for the August 5 crypto crash as fears of a recession grew.
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The US Federal Reserve has so far held back Interest rate cut to reduce inflation to the 2% target. However, their hesitation has led to predictions that the US economy could soon enter a recession.
The US labor market reports for July also showed that market participants have reason to be concerned as the unemployment rate was higher than expected. The macro side has a significant impact on Bitcoin and the crypto market as it largely determines how much money investors are willing to put into these risk assets.
Featured image from iStock, chart from Tradingview.com
