Bloomberg Intelligence’s senior macro strategist Mike McGlone says that the second half of the yr may very well be bearish for Bitcoin (BTC) and the remainder of the crypto markets.
McGlone says that danger property, akin to shares and crypto, may get low cost within the coming months as he believes that an financial recession is on the horizon.
In line with the macro strategist, the Federal Reserve remains to be on the trail of accelerating rates of interest, which he notes may negatively influence the efficiency of Bitcoin and different crypto property.
“Threat property can get low cost in recessions. The cat-and-mouse sport between the rallying inventory market and watchful central banks may very well be an impediment for danger property. Cryptos are among the many riskiest, and the shortcoming of the Bloomberg Galaxy Crypto Index (BGCI) to maintain above its 2018 excessive in 2023 could also be for a very good purpose: the Fed remains to be tightening.”
The BGCI tracks the efficiency of the most important crypto property traded in USD.
McGlone additionally says that the Bloomberg Economics group is predicting an “ugly” second half for cryptos and equities
“Our graphic exhibits a uncommon divergence, with the Nasdaq 100 Inventory Index breaking increased and the BGCI falling in (Q2).
Federal funds futures in a single yr (FF13) are a liquidity gauge, including rising rate-hike expectations to a climbing inventory market could put a ceiling on crypto costs.
The BGCI has rallied in 2023 by about 50% to June 1 and the Nasdaq 30%, which can shift the bias towards what’s typical in recessions: danger property can get low cost.”
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