Bitcoin: Dubious Speculation
Benjamin Cowen examines whether Bitcoin’s move above $83,000 represents a genuine breakout or a false move ahead of historically weak fourth quarters in midterm years. He concludes that $83,000 is the key level: holding it while yields rise would strengthen the bullish case, while losing it could trigger a rapid unwind and revive the typical midterm-year weakness narrative.
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Benjamin Cowen acknowledges that he did not expect Bitcoin to move above $83,000 and says his earlier expectation was wrong.
Cowen says Bitcoin’s move above $83,000 creates two possible outcomes: a genuine breakout or a major fakeout before a typical fourth-quarter decline in a midterm year.
He identifies $83,000 as the critical support level and argues that Bitcoin would need to fall back below it for the bearish fourth-quarter scenario to gain traction.
He argues that the bond market may distrust the soft inflation report because the prior month’s core PCE reading was revised from 3.3% to 3.0%, making the current month appear unchanged rather than lower.
Cowen believes long-term yields are rising partly because the soft-looking inflation report reduces expectations for an October rate hike, which could leave bond markets more concerned about persistent inflation.
Bitcoin Above $83K
Cowen acknowledges he was wrong about Bitcoin exceeding $83,000 and frames the move as either a genuine breakout or a potential midterm-year fakeout.
Midterm Q4 Weakness
Historical midterm-year data suggests Bitcoin often weakens in the fourth quarter, although the new high makes this cycle harder to compare with prior years.
PCE Data Revisions
Soft headline and core PCE readings appear bullish, but Cowen argues revisions to prior data undermine the apparent improvement and explain bond-market skepticism.
Yields And Fed Expectations
Cowen links rising long-term yields to reduced expectations for an October rate hike, arguing markets may fear persistent inflation rather than imminent recession.
Bitcoin And Treasury Yields
Bitcoin has recently weakened during growth scares and falling yields, while rising yields have not yet stopped it, creating an unusual macro setup.
The $83K Support Test
Holding $83,000 would preserve the bullish case, but losing it could trap breakout traders and rapidly revive the typical fourth-quarter weakness narrative.
Russell 2000 Divergence
The Russell 2000 is already suffering under higher yields while large-cap stocks remain near highs, echoing 2018 and potentially foreshadowing broader weakness.
Bitcoin’s Unusual Strength
Most macro trades have followed Cowen’s expectations, but Bitcoin’s new high remains exceptional; holding $83,000 through rising rates would demand a bullish reassessment.
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