Leading cryptocurrency Bitcoin (BTC) is under the scrutiny of a senior macro strategist at Bloomberg. With far-reaching foresight, this strategist presents an alarming price prediction that suggests Bitcoin’s ongoing depreciation could continue for the foreseeable future.
In the latest edition of his report, entitled “Crypto Outlook June 2023“Mike McGlone takes a stance that suggests Bitcoin may not yet be past its most difficult phase.
McGlone claims that given the prevailing patterns, multiple factors influencing the cryptocurrency market and the US Federal Reserve’s bias, the future prospects for Bitcoin appear to be biased towards a bearish trend.
Concerns about Bitcoin price reversal risks
In his latest analysis, McGlone draws attention to Bitcoin’s historical trading patterns. McGlone points out that the cryptocurrency was valued at around $7,000 at the end of 2019, but subsequently experienced a significant surge in liquidity. This remarkable rise raises legitimate concerns about the possibility of a price reversal.
Image: OptoCrypto
McGlone emphasizes the importance of June as a potential tipping point where the prevailing trend towards rising risk assets, including Bitcoin, will either continue or give way to a looming US recession.
Additionally, according to McGlone, any central bank action could have unforeseen consequences that could negatively impact Bitcoin and other risky assets in the near future.
Source: Coingecko
At the time of writing, the current value of Bitcoin is enclosed CoinGecko stands at $27,152, underscoring the downtrend of its 52-week moving average, which is in stark contrast to the initial uptrend seen at the start of the pandemic. The alpha cryptocurrency is up a meager 1.7% over the past week.
The impact of central bank rate hikes
McGlone emphasizes the importance of ongoing central bank rate hikes in shaping the future of Bitcoin. As central banks take a more aggressive approach to tightening monetary policy, the resulting rise in borrowing costs may dampen economic growth and market sentiment. This, in turn, could impact demand for risky assets like Bitcoin.
BTCUSD Slightly Above $27,000 on the Weekend Chart: TradingView.com
In addition, the strategist notes that the market is bullish on the central bank rate hikes could be out of place. While these measures aim to contain inflationary pressures, there is a risk of over-correction and unintended triggering of an economic slowdown or even recession. In such a scenario, Bitcoin could be particularly vulnerable to falling in value as investors seek safer havens for their capital.
As McGlone paints a bearish picture for Bitcoin, it’s important to acknowledge the inherent uncertainty that comes with predicting the future of any financial asset.
-Selected image from Think Magazine
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