- The Bloomberg analyst recognised 5,600 on the S&P 500, equal to around $56,000 for Bitcoin under his scaling, as an initial “normal reversion” level.
- The analyst referred to the “crypto bubble” as “imploding” and mentioned that “Trump euphoria” has surged and is contributing to contagion over markets.
The macro strategist from Bloomberg Intelligence, Mike McGlone, mentioned on February 16 that slipping crypto prices may indicate wider financial stress, alerting that Bitcoin could trace back toward $10,000 and potentially foreshadow the upcoming U.S. recession.
The post made on Monday also mentioned that the well-established “buy the dip” mentality that has backed risk assets since 2008 could be breaking down as digital assets wear out and volatility dynamics shift.
After surging to $70,841 on February 15 from a slip of $65,395 on Feb 12, Bitcoin was exchanging hands at $68,800 by mid-morning. The wider crypto market rested in the red zone on Monday, having 85 of the top 100 tokens showing losses. Privacy-aimed coins Monero and Zcash were down 10% and 8%, respectively, in the last 24 hours.
McGlone also mentioned that Healthy Correction is what we should hear soon from stock market analysts, after slipping cryptos and the buy-the-dip mantra since 2008, which may be over.
He also highlighted various macro indicators that show increased risk conditions. U.S. stock market capitalisation relative to gross domestic product has attained its biggest level in around a century. Meanwhile, 180-day volatility in the S&P 500 and Nasdaq 100 is at its lowest level in around eight years.
What Did The Analyst Further Mention?
He also referred to the “crypto bubble” as “imploding” and mentioned that “Trump euphoria” has surged and is contributing to contagion over markets. At the same time, gold and silver are captivating alpha at a speed last witnessed around 50 years ago, with surging volatility that he said could “trickle up” into equities.
McGlone shared a chart where he compared Bitcoin split by 10 for scaling with the S&P 500. As of Feb 13, both were exchanging hands below 7,000 on his graphic. He mentioned that “volatile and beta-dependent” bitcoin is not likely to stay above the level if wider equity beta weakens.
The Bloomberg analyst recognised 5,600 on the S&P 500, equal to around $56,000 for Bitcoin under his scaling, as an initial “normal reversion” level. After that, part of his base case calls for Bitcoin to return toward $10,000, contingent on a peak in the U.S. stock market.
Highlighted Crypto News Today:
Bitcoin Cash (BCH) at a Crossroads: Bulls Charging or Bears Reloading?
Source: https://thenewscrypto.com/mike-mcglone-warns-bitcoin-could-slide-toward-10k/
