• Crypto strategist Benjamin Cowen says Bitcoin (BTC) could fall further even after correcting by over 15% from its 2023 high.
• He suggests current crypto downturn is in line with a pattern that happens every four years.
• Historical precedent shows BTC could plunge to as low as $17,500 and as high as $11,400.
Bitcoin ‘Secondary Scare’ Now Playing Out
Crypto strategist Benjamin Cowen warns that Bitcoin (BTC) could continue to fall even after correcting by over 15% from its 2023 high reached last month. Cowen suggests the current crypto downturn follows a pattern that occurs every four years. This pattern involves the US S&P 500 stock index getting a correction in August or September of its pre-election year, followed by Bitcoin entering into a downtrend for a while.
How Low Could BTC Plunge?
Cowen outlines three scenarios for how low Bitcoin could go based on historical precedent. A 40% drop would put BTC at around $17,500; whereas a 61% drop would put it at around $11,400; and an 80% drop would put it much lower – though he believes this is unlikely to happen. At time of writing, BTC is trading at $26,423.
Past Secondary Scares
In 2019, once the secondary scare got underway – once we got below the 20-week moving average or weekly candle that led us below it – Bitcoin dropped another 61%. In 2015 there was about a 40% or 39% drop and in 2011 there was an 82.5% drop before finally bottoming out in the secondary scare period.
S&P 500 Correction
The S&P 500 has dropped by just over 5% since the start of August this year – corresponding to the pre-election year’s Q3 correction which historically precedes bitcoin’s downtrends during secondary scares periods like this one.
It remains to be seen how far Bitcoin will fall during this secondary scare period, but based on past data it appears likely that prices could decline further than they already have so far this summer season.