Bitcoin is a ‘wild card’ set to outperform —Bloomberg analyst

The commodity strategist has pegged Bitcoin to rebound strongly from the bear market despite headwinds for high-risk assets.

Bloomberg analyst Mike McGlone has labeled Bitcoin (BTC) a “wild card” which is “ripe” to outperform once traditional stocks finally bottom out. 

In a Sept.7 post on Linkedin and Twitter, McGlone explained that while the United States (U.S.) Federal Reserve tightening will likely determine the direction of the stock market, Bitcoin remains a “wildcard” that could buck the trend, stating:

“Bitcoin is a wild card that’s more ripe to outperform when stocks bottom, but transitioning to be more like gold and bonds.”

The commodities strategist shared more details in a Sept. 7 report, which noted that Bitcoin was primed to rebound strongly from the bear market despite a “strong headwind” toward high-risk assets:

“It’s typically a matter of time for the fed funds gauge to flip toward cuts, and when it does, Bitcoin is poised to be a primary beneficiary.”

The report notes that while Bitcoin would follow a similar trend to treasury bonds and gold, Ethereum (ETH) “may have a higher correlation with stocks.”

The Federal Reserve’s increased quantitative tightening comes amid several major interest rate hikes throughout 2022, with the most recent spike accounting for a 75 basis points increase on Jul. 27.

Macro in Five Charts: Crude, Commodities, Stocks, Bonds, Bitcoin – #Crudeoil may be resuming an enduring bear market and refueling the T-bond bull. #FederalReserve tightening as global GDP turns negative may help transmogrify #stocks to going down on bad news and up on good. pic.twitter.com/KZEWsZyI8h

— Mike McGlone (@mikemcglone11) September 7, 2022

While it is not known exactly when the Fed’s quantitative tightening will end, some economists predicted the endpoint will begin “at some point in 2023” according to a Bloomberg article published in August. 

Quantitative tightening is a contractionary monetary policy tool that is used by central banks to reduce the level of money supply and liquidity in an economy, which can reduce spending across markets, such as stocks. 

Related: Bitcoin likely to transition to a risk-off asset in H2 2022, says Bloomberg analyst

But despite Bloomberg’s bullish take, other experts believe that Bitcoin and equity markets have actually become more correlated than before.

Cointelegraph contributor Michaël van de Poppe recently said the correlation between the S&P 500 index and BTC was approaching 100%, while a number of IMF economists claimed to have seen a 10-fold increase in correlation between crypto and equity markets in some regions of the world.

Related Posts

South Carolina treasurer goes on Bitcoin ‘fact-finding trip’ to El Salvador

The state official reportedly used his own funds to pay for the trip, which included discussing Bitcoin with government officials and exploring financial literacy programs. Curtis Loftis,…

Kardashian’s EthereumMax Lawsuit Turns Against SEC Chair

Earlier this week, the U.S. Securities and Exchange Commission (SEC) charged and settle a lawsuit with socialite and billionaire Kim Kardashian for allegedly withholding information about promoting…

US Job Openings Plummet- What Does It Mean for Bitcoin?

The number of new job openings in the US markets decreased by 6.2%. What is in store for the U.S. markets and Bitcoin? It is the 2nd…

Bitcoin Price at Generational Bottom With Institutions Buying en Masse

Crypto analyst Cred opines that bitcoin may have hit a generational bottom, presenting a good buying opportunity for long-term holders. On Oct. 5, 2022, Fidelity Investments purchased…

3 Easy Ways to 10x Your Bitcoin and Ether in October

Whether crypto is now on the path towards recovery or faces a wintery “Septembear”, you can still make a profit from your digital currency relatively easily. Here…

Big Eyes Coin and Axie Infinity – Which NFT-Based Cryptocurrency Has Greater Potential In The Market?

A brand-new NFT-based cryptocurrency called Big Eyes coin (BIG) will be released into the market, and if its pre-sale is any indication, it’s going to rock the…

Generated by Feedzy