Bitcoin and Cryptocurrency Alerts from Bloomberg Senior Analyst Mike McGlone!

Mike McGlone, a senior commodity strategist at Bloomberg Intelligence, in a recent tweet bitcoin And cryptocurrencies shared its downward trend.

McGlone also argued that the crypto market falling in the second quarter of 2023 may reflect doubts that the stock market can continue its strong recovery in the first half of the year.

He also suggested that rising stock prices, fueling the Fed’s rate hike expectations, could create a double loss situation for risky assets like cryptocurrencies.

The analyst pointed out that the Bloomberg Galaxy Crypto Index (BGCI), which tracks the performance of the largest and most liquid digital assets, has failed to stay above its 2018 high this year, while the Nasdaq 100 Stock Index has reached new highs.

He attributed this divergence to the FED’s ongoing monetary tightening, which reduced the liquidity available for speculative investments. He presented a chart showing the inverse relationship between BGCI and one-year federal funds futures, which reflects the market’s expectation of future interest rates.

He warned that the combination of a rising stock market and a hawkish Fed could hit crypto prices, especially as Bloomberg Economics predicts an “ugly” second half of 2023 due to an impending recession.

The analyst concluded that crypto assets could become priced lower in such a scenario, often as in economic downturns.

*Not investment advice.

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