- Benjamin Cowen compares Bitcoin price development with the Nasdaq of the dotcom crash era.
- Nasdaq crashed by about 77% before pulling off a 60% rebound.
- Bitcoin has fallen by 77% and made a 60% recovery since the beginning of the latest bear market.
Benjamin Cowen, the CEO, and co-founder of the quantitative market analysis platform ‘Into The Cryptoverse’ has shared his opinion on the current Bitcoin market cycle. He analyzed the collected data to predict the next Bitcoin direction and what users should expect in the coming weeks.
Cowen started his analysis by comparing Bitcoin with the Nasdaq of the dotcom crash era. Then, Nasdaq crashed by about 77% before pulling off a 60% rebound. Bitcoin has mirrored this behavior with the price developments from the latest bear market. The drawdown for Bitcoin was 77% before it bounced in January 2023, making a 60% recovery ahead of the current consolidation.
During the analysis, Cowen noted that Bitcoin has rallied up to its 50-week moving average, replicating Nasdaq’s behavior during the dotcom crash. Using this information, and data fetched from other indicators, he established striking similarities between what Nasdaq experienced and what Bitcoin is going through.
Cowen classified the current week as a critical one for the Bitcoin price. He compared Bitcoin’s weekly Relative Strength Index (RSI) with that of Nasdaq in the dotcom crash. Until the time of analysis, both assets have maintained similarity in movement. However, with Bitcoin’s current price situation, Cowen noted that a continued rally would trigger a deviation from the Nasdaq trend, and Bitcoin’s price could continue into more price discoveries.
Continuing with his analysis, Cowen identified three notable rallies on the Nasdaq that fell short ahead of the substantial bottom. All three rallies were approximately 40%, 50%, and 60%. Like the other indicators, Bitcoin price has followed this trajectory, registering two concluded rallies at 40% and 50%, with the current rally nearing 60%.
Cowen’s analysis provided striking similarities between Bitcoin’s current behavior and the evolution of Nasdaq during the dotcom crash. It supports the idea that investors can use historical data to predict future market behavior. Based on that, Bitcoin investors may need to pay close attention to what happened during the dotcom era, with Nasdaq as a guide to the future of Bitcoin’s price.