Bitcoin Faces Death Cross Test As Analyst Benjamin Cowen Warns of Sub-$60k Drop

Crypto analyst Benjamin Cowen recently discussed the impact of the death cross indicator, which has appeared again on Bitcoin's chart.

Bitcoin has formed a death cross again, and this time around, it seems to be converging with other macroeconomic factors that could impact Bitcoin’s price negatively.

Thanks to this indicator, the $62,000 price level has become crucial to Bitcoin avoiding another price crash.

Bitcoin Dropped Lower After Forming Death Cross At $62,000

Bitcoin is at risk of dropping lower if it fails to hold above $62,000 heading into the Death Cross.

After recovering from its price crash below $50,000 on August 5, Bitcoin had rallied to as high as $62,000. This rise brought about the Death Cross, which now threatens lower prices for the flagship crypto.

The last time the Death Cross occurred was in 2019, and it marked a local top for Bitcoin. The crypto went on to record lower highs after then, and its price was bearish for about four months afterward.

However, things could play out differently this time, especially considering that indicators like these tend to play out in a “slightly different way” throughout different cycle phases.

Moreover, 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.

Bitcoin’s fate will ultimately depend on external factors rather than the prevailing conditions in the crypto market. This includes macroeconomic factors like inflation and the labor market.

The macro side is believed to be responsible for the crypto crash on August 5 as fears about a recession heightened.

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.

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