Bitcoin’s future is shrouded in uncertainty, according to Bloomberg Intelligence’s senior macro strategist, Mike McGlone.
The expert highlighted the potential risks facing the benchmark cryptocurrency and raises concerns about its current price level. Find out more- read on!
Caution as Bitcoin Hovers at $27,000
Bitcoin experienced a substantial liquidity pump at the end of 2019, catapulting its value to new heights. However, McGlone suggests that this historical event could indicate a reversion to the mean, potentially leading to a downward correction. With Bitcoin hovering around $27,000 on May 19, there are valid concerns about its ability to sustain its upward trajectory.
McGlone points to the 52-week moving average of Bitcoin, which shows a downward trend compared to the remarkable surge witnessed at the beginning of 2020. Although Bitcoin recovered from a low point in 2022 when it dipped to around $15,000, its value surged to approximately $30,000 in April 2023.
Bitcoin’s Market Sentiment
This rapid increase experienced by the crypto may suggest an overbought market, raising questions about the sustainability of Bitcoin’s current price level. Understanding the patterns of Bitcoin’s cycles of ups and downs, often influenced by liquidity injections or removal, is crucial when assessing its future direction, according to McGlone.
Related: Bitcoin Bulls Exhausted! Peter Brandt Predicts Massive Market Shakeup – Coinpedia Fintech News
Interestingly, while the Federal Reserve has tightened its policies twice despite concerns about a potential bank run, McGlone believes this unwavering stance may signal deflationary pressures on risk assets. He notes that both the copper market and cryptocurrencies, with Bitcoin being the prime example, appear to be taking heed of these warnings, in contrast to the resilience displayed by the stock market.
Do we see BTC breaking its price barriers in June/July as predicted or should we prepare for more bloodbaths?
As Bitcoin teeters on the edge of a potential reversion, investors and enthusiasts alike are left pondering its next move. Till we have a clearer picture, stay informed, adapt your strategy, and ride the waves of opportunity when they present themselves.