Bitcoin: Never Below $40,000 Ever Again? Crypto Analyst Benjamin Cowen Explains Why It's Possible

Last updated: Mar 30, 2023
4 Min Read
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There is an argument to be made that Bitcoin may never go below the $40,000 level ever again, according to popular technical analyst Benjamin Cowen.

In a new analysis video, Cowen makes the case that sub $40,000 Bitcoin may never be seen again based on an indicator known as 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), and functions like a standard moving average cross-over signal. When the 20-week SMA crosses above the 21-week EMA, the band becomes bullish and acts as price support in a bull market. On the contrary, when it crosses below, the band becomes bearish and acts as a resistance in a bear market.

Cowen looks at BTC's entire history and notes that once price holds above the support band, even if after several unsuccessful tests, it eventually never sees that price again.

Benjamin Cowen

"One of the reasons why I like [the bull market support band] so much is because historically speaking, when Bitcoin holds the line at the bull market support band – and hold on to your hats – it has not gone below that price where it held ever again. You're probably like, 'what is Ben smoking?' You're probably wanting two of them right...

We held the line back in April of 2011. Bitcoin held the line – viewer discretion advised – at a very modest $0.65. I don't know about you guys but I've never seen Bitcoin since then on sale for $0.65...We then held the line in May of 2012 at $5.00. We never went below $5.00, never."

Cowen notes that Bitcoin occasionally does little fakeouts at the support band, sometimes wicking down mid-week or printing a couple weekly candles in the middle of it, which can make the indicator seem ambiguous in real time. BTC has "held the line" and then never gone lower more than 20 times in its history, even in bear markets.

The last time the leading crypto bounced off the support band was at $10,000, which so far, hasn't returned. While Cowen says it may be dubious or "a little sketchy" to deterministically say "it can't go below $40,000," he does say that BTC holding the line around $40,000 in mid-September is potential evidence that we might not see those prices again. He says the idea would become more believable once Bitcoin manages to make all time highs.

"Right now we're sort of in that zone where we could wake up tomorrow and Bitcoin could dump 10-20% or something and then it could go back down into a downtrend, and it's certainly possible that we go back to those levels. But where it could become a little bit more believable is if we continue higher, then we put in all-time highs, and then we just continue on... And then it makes it a lot more believable that we may never go below $40,000 again.

Put it this way. The next time it starts with a '3', might be when it's $300,000, not thirty-something thousand."

Ultimately, Cowen says he believes Bitcion has "clear skies ahead," and that the supreme coin will probably grind higher through the $65,000 milestone, even if there are initial rejections. BTC is currently about a 28% plunge away from the top of the bull market support band, and just over 10% away from all-time highs.
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Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.

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