The price of bitcoin will be reinforced after the fall of the shares “between 10 and 20%”, says a Bloomberg analyst

The Fed’s policy should see markets drop by as much as a fifth, says Mike McGlone of Bloomberg Intelligence.

The price of bitcoin (BTC) will soon cease to be a risky asset and investors should prepare for a further price correction, says one of the best-known analysts at Bloomberg.

In an appearance on the Wolf of All Streets podcast on Jan. 18, Mike McGlone, senior commodity strategist at Bloomberg Intelligence, sounded the alarm about the “only up” narrative for global markets.

McGlone: ​​bitcoin is the least risky crypto bet

As bitcoin struggles in 2022, those hoping for a dramatic return to form will be disappointed by McGlone’s medium-term forecast.

The US Federal Reserve, he says, will virtually guarantee the end of unlimited gains for stocks, and the naturally correlated cryptocurrencies will suffer as well.

“The number one theme I’ve been using for months is ‘Don’t fight the Fed,'” he began.

“If you’re long risky assets, you’re fighting the Fed, and cryptocurrencies are the riskiest assets. The key, remember, is that bitcoin is the least risky of the cryptocurrencies.”

As the Fed tries to curb inflation and slash asset purchases, the outlook is much less rosy for short-term risk assets. For McGlone, however, there is a silver lining when it comes to bitcoin’s inherent appeal.

“I think it’s going from being a risky asset to a risky asset,” he continued, adding that “I think bitcoin will fare better” after the period of political turmoil.

“Here’s my prediction: markets eventually pull back and we have a 10-20% correction in the stock market. All correlations are one, which is how it usually works. bitcoin fare better for it.”

The Fed struggles with its balance sheet

McGlone, famous for his bullish views on bitcoin in the past, is far from alone in wary of it.

As Cointelegraph reported, even bitcoin traders themselves are bracing for the testing times ahead, while analyst views were echoed earlier this month by Arthur Hayes, former CEO of derivatives trading platform BitMEX. .

“U.S. loose monetary conditions definitely played a role in the meteoric rise in price (albeit a few months late),” he wrote of the Fed balance sheet in a blog post on politics and Bitcoin.

“Ever since M2% growth stalled, bitcoin has traded sideways. If M2 is going to hit 0% – and possibly even go negative – before too long, the natural conclusion is that bitcoin (in the absence of any asymptotic growth in the number of users or transactions processed through the network) is likely to go much lower as well.”

Reference: es.cointelegraph.com

Disclaimer: This press release is for informational purposes information does not constitute investment advice or an offer to invest. The views expressed in this article are those of the author and do not necessarily represent the views of infocoin, and should not be attributed to, Infocoin.

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