Bitcoin’s Bumpy Road Ahead: Insights from Bloomberg Analyst Mike McGlone
According to senior macro strategist Mike McGlone from Bloomberg Intelligence, Bitcoin (BTC) is anticipated to experience a decline as a result of recessionary pressures.
In the latest edition of Crypto Outlook, McGlone suggests that Bitcoin may not have reached its lowest point yet, and he predicts a liquidity crisis in the latter half of 2023 due to an impending US recession.
In the best-case scenario, June might exhibit a continuation of the upward trend seen in the first half of the year, particularly for Bitcoin and other risk assets. However, there is also a possibility that the situation could deteriorate, leading to a US recession.
McGlone believes that the latter scenario is more likely, especially since market expectations seem overly optimistic due to delayed effects from aggressive central bank interest rate hikes that are still ongoing.
Despite recent market rebounds, McGlone doubts their sustainability and anticipates an overall downward trend in the market. He suggests that the potential for the Nasdaq 100 Stock Index to boost all assets temporarily may not last.
He observes consistent downtrends by analyzing the 100-week moving averages of both the stock index and Bitcoin. The key question is whether the worst has already passed or if the trend will continue, given the recent price fluctuations.
READ MORE: Crypto Exchange Bybit Exits Canadian Market
McGlone’s pessimistic viewpoint is influenced by the observation that liquidity pumps tend to reverse and result in ongoing market dumps, as indicated by Federal funds futures over a one-year period (FF13). He suggests that a decline in equities might be necessary for interest rates to decrease.
Having previously warned about Bitcoin potentially dropping as low as $7,000, McGlone asserts that an anticipated US recession will likely exert additional downward pressure on risk assets like BTC.
He believes that Bitcoin’s peak of approximately $30,000 in 2023, compared to the 100-week mean of around $33,000, could cause this globally traded risk indicator to return to a more realistic level, potentially around $7,000.
This adjustment would align with the unprecedented liquidity boost experienced in 2020-21. Notably, the expected US recession has not yet materialized, which could further impact risk assets.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
