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Widely followed crypto analyst Benjamin Cowen says incoming inflation data could largely influence the trajectory of Bitcoin (BTC).
In a new video, the analyst tells his 771,000 subscribers that interest for Bitcoin will likely come back if the price of the top crypto asset breaches the bull market support band.
The bull market support band is a combination of the 21-week exponential moving average (EMA) and the 20-week simple moving average (SMA).
“I want to draw your attention to the logarithmic regression channel. We are near the bottom of it. It was fit a long time ago. We are coming up to the bull market support band. If we break above it, there will likely be a lot of people FOMOing (fear of missing out) back into the market.”
Cowen warns that instead of breaking out, surging consumer price index data (CPI), scheduled for next week, and more hawkishness from the Federal Reserve could trigger another leg lower for BTC. He targets the $14,000 level in such a scenario.
“If we get rejected by it, if Powell comes out and is super hawkish or something, which could happen. Core CPI is at new highs. It’s higher today than it was for the entire year so if core CPI comes out and it continues to come in hot and the Fed continues to provide us with oversized interest rate hikes, then you could see a lower low sooner rather than later and then we try to work our way out of it into the next bull cycle.”
Even if another leg down is in the cards for Bitcoin, Cowen still says that BTC trading anywhere near the $20,000 range is good value for for long term bulls.
“As I’ve said, long-term value, I think [is] around $20,000. I think it is going to provide a lot of long-term value for Bitcoin. Is it going to give you the best price in the short term? It’s hard to say. Short-term moves are very difficult to predict, at least for me they are. But I do think around these prices over the macro scale is is still going to be a relatively attractive price.”