Closely followed crypto analyst Benjamin Cowen has identified a potential floor price for Bitcoin as the flagship crypto tumbles over 50% from its all-time high.
In a new interview on financial freedom YouTube channel InvestAnswers, Cowen says that $30,000 is acting as the pivotal price level for Bitcoin.
“Clearly $30,000 is a big area as well. I don’t want to say there’s necessarily an absolute floor, because if you do and it goes below it then you have to make a new floor. But I would say there’s probably certainly probabilities associated with the various levels holding, and obviously, the further down we go, the more likely it is we’re going to hold that price.
$30,000 is certainly an area of interest in the event of a cascade down. I don’t want to scare anyone but I also don’t want to say that it’s impossible that we go below $30,000, because we could. We went below $30,00 in the summer. We went below $30,000 in January…”
The widely followed analyst says that a “full-on worst-case scenario” would put Bitcoin at around $20,000.
According to Cowen, one thing to keep an eye on with Bitcoin is its dramatically oversold relative strength index (RSI), an indicator that tracks whether an asset is overvalued or undervalued. He points out that it’s nearly at levels not seen since the pandemic-induced crash of March 2020, indicating that BTC is currently undervalued.
“It could get worse before it gets better. You look at the weekly RSI and it’s pretty low, but it could also go lower. I don’t want to sound like it can’t get lower. We’re about as low as we were in March 2020, but for us to get as low as we were in March 2020, we would actually need to sustain this downtrend for a few more weeks, I believe. To get back to where we were back in the end of 2018, we might need to see the price action stay more or less like it is in a slow bleed. That could still play out over the next couple of months, and so that’s why I said before, I think that Q1 is going to remain bearish…
When the market is bearish, that really is when you really want to be getting into the market. Bull markets make you money and bear markets make you rich.”