• Bloomberg Intelligence’s senior macro strategist Mike McGlone is predicting that Bitcoin (BTC) will drop lower due to recessionary headwinds.
• He predicts a broader downward market trend will continue, likely pushing risk assets like BTC much lower.
• McGlone previously warned Bitcoin could dip to as low as $7,000.
McGlone Predicts Worst May Not Be Over for Bitcoin
Bloomberg Intelligence’s senior macro strategist Mike McGlone is warning that the worst may not be over for Bitcoin (BTC). In a new Crypto Outlook edition, McGlone predicts a liquidity crunch in the second half of 2023 due to a US recession and believes markets have not priced in an optimistic outcome from the long and variable lags of aggressive central-bank rate hikes.
Rising Nasdaq 100 Stock Index Could Lift All Boats
McGlone says that while markets have bounced recently, he does not believe their strength is sustainable. The potential for the rising Nasdaq 100 Stock Index to lift all boats may be ephemeral, as both the stock index and Bitcoin are in downtrends according to their 100-week moving averages.
Bitcoin Price Could Drop Below $7000
McGlone previously warned that Bitcoin could dip to as low as $7,000 due to an expected US recession which would pressure risk assets accordingly. The pre-eminent globally traded risk indicator has already felt gravity from its comfort zone around $7,000 before the unprecedented 2020-21 liquidity boost – with its current high at around $30,000 compared to its 100-week mean at around $33,000.
Central Bank Rate Hikes Could Reverse Liquidity Pumps
McGlone believes that it may take a decline in equities for rates to fall and Central bank rate hikes could reverse liquidity pumps which are still dumping – as indicated by Federal funds futures in one year (FF13).
Conclusion
Mike McGlone’s outlook on BTC suggests that investors should be cautious when making any high-risk investments into digital assets – with prices potentially dropping below the previous support level of $7000 if current trends continue and markets do not reverse into an optimistic outcome from central bank rate hikes.