Bitcoin’s Bullish Outlook Faces Short-Term Risks, Analyst Warns
Bitcoin's outlook appears brighter as the U.S. dollar weakens, but there are potential short-term risks that could limit its gains, according to Real Vision crypto analyst Jamie Coutts.
He remains cautiously optimistic about Bitcoin’s trajectory but points to two key metrics that could complicate the situation: U.S. Treasury bond volatility and widening corporate bond spreads.
Despite the U.S. Dollar Index (DXY) reaching its lowest level in months, there are concerns that increased Treasury bond volatility could tighten liquidity in the market. As this volatility rises, central banks may need to intervene, which could disrupt the favorable conditions for Bitcoin.
Moreover, the growing gap in corporate bond spreads is another red flag, as these reversals have historically coincided with Bitcoin price peaks.
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Coutts still maintains that the primary driver for Bitcoin’s potential growth is the weakening of the dollar, which has seen one of its largest drops in recent years. Other bullish factors, such as the strategic accumulation of Bitcoin by major players and increasing liquidity in the market, further bolster the cryptocurrency’s case.
In the face of central banks’ dwindling options and strong Bitcoin reserves, Coutts believes the odds are increasingly favoring Bitcoin holders, even if some risk factors loom in the short term.
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.
