In a recent Analysis, Bloomberg Intelligence’s senior macro strategist Mike McGlone expressed concern about the current trajectory of Bitcoin (BTC), drawing parallels between price movements and the infamous stock Market bubble of 1929. McGlone points out the striking similarity of Bitcoin’s parabolic rise over the past decade with that of the stock market in the lead-up to the 1929 crash. He also underlines the importance of a high-interest rate environment, reminiscent of conditions before the stock market crash in 1930.
McGlone supports his comparison by presenting a chart showing the U.S. discount rate, which peaked in 1929, and the 100-week moving average of the Dow Jones Industrial Average (DJIA), which began to decline around the same time. Similarly, Bitcoin’s 100-week moving average is currently showing a downward trend following the Fed’s sharp rise in interest rates last year, raising concerns about a potential correction in the cryptocurrency market.
The analyst also emphasizes that Bitcoin’s rise has similarities with the stock market in the 1920s in terms of technological developments. He draws parallels between the advent of Bitcoin and the proliferation of revolutionary technologies such as electricity, cars, air travel, and telephones nearly a century ago. It is worth noting that both the parabolic rise of Bitcoin and the rise of groundbreaking technologies in the 1920s coincided with periods of low interest rates sustained by the Fed.
While McGlone acknowledges potential bullish aspects of the current situation, such as the emergence of revolutionary technologies, parabolic price movements, excessive liquidity, and speculation, he points out an important difference. He notes that the New York Fed responded to falling stock prices in 1929 by lowering interest rates, whereas the current environment is characterized by rising interest rates.
It is important to consider McGlone’s track record in making predictions about Bitcoin. While he previously predicted that BTC would rise to $100,000 during the rise in 2021, he warned that such gains would happen in the long run. Therefore, investors and analysts closely monitor Bitcoin’s price action, currently Trading at $26,020, in light of historical comparisons and their potential impact on the future trajectory of the cryptocurrency market.
Overall, McGlone’s analysis raises concerns about the current trajectory of Bitcoin and draws parallels between its price movements and the stock market bubble of 1929. However, it is important to note that his predictions have both been correct and incorrect in the past. Therefore, the market dynamics and future performance of Bitcoin should be closely monitored..
#Bloomberg #Analysts #Parable #Bitcoin
McGlone supports his comparison by presenting a chart showing the U.S. discount rate, which peaked in 1929, and the 100-week moving average of the Dow Jones Industrial Average (DJIA), which began to decline around the same time. Similarly, Bitcoin’s 100-week moving average is currently showing a downward trend following the Fed’s sharp rise in interest rates last year, raising concerns about a potential correction in the cryptocurrency market.
The analyst also emphasizes that Bitcoin’s rise has similarities with the stock market in the 1920s in terms of technological developments. He draws parallels between the advent of Bitcoin and the proliferation of revolutionary technologies such as electricity, cars, air travel, and telephones nearly a century ago. It is worth noting that both the parabolic rise of Bitcoin and the rise of groundbreaking technologies in the 1920s coincided with periods of low interest rates sustained by the Fed.
While McGlone acknowledges potential bullish aspects of the current situation, such as the emergence of revolutionary technologies, parabolic price movements, excessive liquidity, and speculation, he points out an important difference. He notes that the New York Fed responded to falling stock prices in 1929 by lowering interest rates, whereas the current environment is characterized by rising interest rates.
It is important to consider McGlone’s track record in making predictions about Bitcoin. While he previously predicted that BTC would rise to $100,000 during the rise in 2021, he warned that such gains would happen in the long run. Therefore, investors and analysts closely monitor Bitcoin’s price action, currently Trading at $26,020, in light of historical comparisons and their potential impact on the future trajectory of the cryptocurrency market.
Overall, McGlone’s analysis raises concerns about the current trajectory of Bitcoin and draws parallels between its price movements and the stock market bubble of 1929. However, it is important to note that his predictions have both been correct and incorrect in the past. Therefore, the market dynamics and future performance of Bitcoin should be closely monitored..
#Bloomberg #Analysts #Parable #Bitcoin
