Altcoins Can See 40% Drop Against BTC Pairs Over The Next Few Months, Says Analyst
The broader cryptocurrency market has come under the grip of bears with Bitcoin ETFs seeing $162 million in outflows a day before the FOMC meeting. Higher inflation print could likely nullify the chance of Fed rate cuts this year. In the last 24 hours, the Bitcoin price has tanked 5% slipping under $60,000 while altcoins are seeing an even deeper correction.
Altcoins To See Even Deeper Corrections
Crypto analyst Benjamin Cowen recently shared insights suggesting a potential correlation between altcoin-to-Bitcoin (ALT/BTC) pairs and impending rate cuts. Cowen drew parallels with the previous cycle, noting ALT/BTC pairs’ capitulation just before rate cuts. He speculated that history might repeat itself, implying a further 40% decline in ALT/BTC pairs over the coming months.
Last cycle, we saw #ALT /#BTC pairs capitulate just before rate cuts.
Perhaps this time is not different? This would mean ALT/BTC pairs drop another 40% from here over the next few months.
Short-term countertrends do not invalidate this view. pic.twitter.com/BK3VIrCBJ2
— Benjamin Cowen (@intocryptoverse) April 30, 2024
Despite short-term countertrends, Cowen maintained his perspective, highlighting the ongoing struggles of altcoins amidst plummeting social interest. He pointed out a lack of concern among investors, paralleling the scenario to that of 2019. During that period, social interest also declined before rate cuts, and ALT/BTC pairs bottomed out when the Federal Reserve adjusted its stance.
May Could Be Tough for Bitcoin and Crypto
The Bitcoin price has extended its losses, as it trades at $59,500 levels as of press time. The month of April turned out to be the worst-performing month for Bitcoin after the FTX collapse in November 2022. Market analysts are pointing out a further downside for the BTC price to $52,000, if it breaks under $58,000, its 100-day EMA.
The last time #Bitcoin tested the 100-day EMA while the RSI dipped to 36 was in late January, sparking a major price rebound.
Now, $BTC is back at these levels! However, be cautious— a sustained close below the 100-day EMA might signal a drop toward the 200-day EMA. pic.twitter.com/cAxsq5ZaQI
— Ali (@ali_charts) April 30, 2024
Market analyst Patric H. anticipates a challenging emotional ride for Bitcoin and altcoin investors in May. He suggests that within the next 2-6 weeks, there may be a final shake-out period before a potential breakout occurs. He added that the sentiment is too euphoric as the Fear and Greed Index shows towards the “Greedy” side.
Patric added: “The market is losing momentum as we observe continued outflows from Bitcoin ETFs. Coupled with the underwhelming debut of the HK ETF, which posted only $11M in trading volume (instead of the expected $300M), investor expectations are not being met”.
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