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Crypto doom? Bloomberg strategist warns of share correction!
Mike McGlone from Bloomberg warns of risks for crypto-assets in potential share corrections. Current correlation and forecasts.
Crypto doom? Bloomberg strategist warns of share correction!
Mike McGlone, Senior Commodity Strategist at Bloomberg, has made concern about the future development of the crypto assets. In his opinion, these could first be affected by potential price declines if the US stock markets experience a correction. This warning comes at a time when the evaluations of US shares are considered "exaggerated". McGlone emphasizes that the current correlation between crypto-assets and the stock market is very high, with a value of 0.6, which indicates a significant risk of cryptocurrencies.
He draws a comparison to the 1999 and 2000 internet bubble and warns investors that developments in today's crypto market could take similar patterns. Against this background, McGlone predicts that Bitcoin (BTC) may be doing worse in the future than gold. The ratio of Bitcoin to gold is currently 29.5, with the maximum level of 40 and the low of 25 being recorded at 25 this year.
Current market developments
McGlone underlines that these market conditions are alarming. Another aspect of his analysis is the possibility that the Bitcoin gold ratio could fall below the 25 mark. Such a decline could serve as an indicator of a wider decline in the stock market and in other risky systems.
The current developments in the stock market and the associated risks to cryptocurrencies have alerted both institutional and private investors. Many see the need to adapt their portfolios to be prepared for possible losses by a market correction. McGlone’s forecasts and analyzes call for the volatility and the associated risks of the crypto markets seriously, especially in an insecure economic environment.