Widely followed cryptocurrency analyst Benjamin Cowen warns that Ethereum (ETH) could collapse due to at least one major financial concern.
In a new strategy session, Cowen tells his 779,000 Youtube subscribers that the leading smart contract platform could drop more than 65% from today’s price of $1,174.
“I think you’re still looking at a leg lower here on Ethereum’s valuation against the US dollar. I think around the $400-$600 range is a good place to start looking for the same kind of value that we saw in the last cycle.”
Cowen also pays close attention to the social risk metric, an indicator that measures retail interest in the space by tracking the number of people tuning into crypto YouTube channels and following accounts on Twitter dedicated to digital assets.
According to Cowen, Ethereum’s social risk calculation suggests that ETH is lining up for another selling event.
“I still think Ethereum is probably looking at lower prices eventually. I think this is supported by the idea of the social risk. Social risk is finally making new lows. When the social risk goes down, Bitcoin dominance typically increases…
As a social risk plummets like it did over here in 2018, that’s where Ethereum took the next leg down.”
Cowen also says that a looming recession, likely triggered by the Federal Reserve’s persistent rate hikes, will drive Ethereum far down.
“I understand that you know that a $600 Ethereum or even a $400 Ethereum is another 50% correction or more from those levels. But I think there’s reason to believe it could happen, not just from a price perspective and a technical perspective.
And I know that’s kind of the basic idea of all the Ethereum that’s been burned and stuff. But the flip side of that is we’re looking at a recession…
If a recession comes, that’s probably not a good thing for risk assets like cryptocurrencies.”
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