A widely followed crypto analyst is issuing a warning, saying that the rest of 2024 looks less than ideal for altcoins.

In a new video update, crypto strategist Benjamin Cowen tells his 813,000 YouTube subscribers that based on historical patterns, altcoins appear set to plummet near the end of the year and capitulate against Bitcoin (BTC).

Cowen says the capitulation also lines up with the beginning of a new interest rate-cutting cycle.

“If you connect the dots from the last cycle, 2018, 2019 to 2020, you can see that it basically tagged this trend line three times and then the third tag of the trend line ended up being the bottom.

We know that this interest rate cycle, this business cycle, has taken a little bit longer and if you connect the dots again – one, two and three – the third tag of the trend line might actually occur by the end of the year and coincidentally if you look at this trend line where you connect the dots, it hits 0.25 in Q4 which is exactly what I’ve said could be the ultimate outcome: alt/Bitcoin pairs capitulating before the end of the year.

So I think there is a case to be made that alt/Bitcoin pairs will simply get rejected at 0.4, they could still wick a little bit above it, but I ultimately think they will get rejected and they will come back down to the range lows before the end of the year.”

According to Cowen, altcoins will also bleed out against the top crypto asset by market cap due to low net global liquidity, which he argues is a big driver for digital assets.

“One of the things that you have to consider is what’s causing this to go down and arguably one of the main things is net liquidity. So if you look at the global net liquidity approximation, you will see that it has in fact been putting in lower highs and lower lows for a while and actually if you overlay this chart with alt/Bitcoin pairs, you can actually pretty clearly see that alt/Bitcoin pairs broke down to the fake out right at the same time net liquidity was having a fake breakdown.”

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Crypto analyst Benjamin Cowen recently discussed the impact of the death cross indicator, which has appeared again on Bitcoin’s chart. Thanks to this indicator, the $62,000 price level has become crucial to Bitcoin avoiding another price crash.

Cowen noted in a video posted on his YouTube channel that Bitcoin is at risk of dropping lower if it fails to hold above $62,000 heading into the Death Cross. Bitcoin had rallied to as high as $62,000 after recovering from its price crash below $50,000 on August 5. The rise to $62,000 brought about the Death Cross, which now threatens lower prices for the flagship crypto.

The Death Cross And Its Impact On Bitcoin’s Price

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As such, Bitcoin must reclaim and hold above the $62,000 price level soon enough, or it risks further price declines, with a drop below the psychological level of $60,000 already in sight. The crypto analyst specifically drew comparisons to the Death Cross, which occurred in 2019, to provide insights into what Bitcoin’s next move might be. 

He noted that the Death Cross in 2019 marked a local top for the flagship crypto, as it went on to record lower highs after then, and its price was bearish for about four months afterward. However, Cowen admitted that things could play out differently this time, noting that indicators like these tend to play out in a “slightly different way” throughout different cycle phases. 

The timing of this Death Cross could also provide insight into what might happen next for Bitcoin. Cowen noted that September is, on average, the worst month for Bitcoin, suggesting that the flagship crypto could suffer a downtrend that could extend into September.

It Boils Down To The Macro Side

Cowen revealed that whatever happens next for Bitcoin will mainly depend on external factors rather than the prevailing conditions in the crypto market. This includes macroeconomic factors like inflation and the labor market. Indeed, the macro side is believed to be responsible for the crypto crash on August 5 as fears about a recession heightened.

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The US Federal Reserve has so far held off on cutting interest rates in a bid to bring inflation down to its desired 2%. However, their hesitation has led to projections that the US economy could soon enter a recession. 

The July US job reports also showed that market participants have cause to be worried as the unemployment rate was higher than expected. The macro side significantly impacts Bitcoin and the crypto market because it largely determines how much money investors are willing to invest in these risk assets.

Featured image from iStock, chart from Tradingview.com