With the price of Bitcoin (BTC) demonstrating a largely sideways movement trend over the last seven days, senior commodity strategist at Bloomberg Mike McGlone has expressed concern over the flagship decentralized finance (DeFi) asset underperforming.
Specifically, McGlone stated that Bitcoin seems alone under the radar of the United States regulatory crackdown, which means that it should be outperforming most risk assets, but it isn’t, as he explained in a social media post shared on August 2.
Bitcoin acting out of order
According to the analyst, “in decline vs. the Nasdaq 100 Stock Index since the 2021 peak and April bounce, waning Bitcoin may presage rising headwinds for itself and the broad crypto market. ” Furthermore, he noted, if the asset “fulfills what some consider the fastest-horse-in-the-race mantra, it seems logical Bitcoin should outperform in an everything bull market,” but “it’s not.”
As he further specified, Bloomberg’s graphic indicates this might be taking place due to “the most aggressive liquidity pull from central banks in history” and the Federal Reserve “tightening in the third quarter despite the producer price index finished-goods gauge at minus 3.1% and dropping from 2022’s 18.3% peak at its fastest pace since 1948.”
According to McGlone, Bitcoin could be sniffing out the above factors and responding to them. Moreover, he also stressed that both the Nasdaq and Bitcoin were up just over 20% on a one-year basis but that the maiden crypto asset’s volatility was about two times higher.
Bitcoin versus other assets
Earlier in May, McGlone shared his expectation that gold was likely to demonstrate dominance and continue to outperform Bitcoin in the following months when the precious metal sought to attain new highs, as highlighted by the Bitcoin-to-gold ratio at the time.
In June, he noted that Bitcoin was facing its first recession and a potential equity bear market in the US, as it trails the recent Nasdaq Index gains and was under the effect of federal funds futures that were “showing little potential for additional liquidity fuel,” and that the approval of a spot exchange-traded fund (ETF) would not shield it from the consequences.
More recently, the commodities expert voiced his opinion that the second half of 2023 could “define the benchmark crypto as a high-beta version of the stock market, or for its potential to be digital gold in a world going that way,” as Finbold reported on July 7.
Bitcoin price analysis
In the meantime, Bitcoin was changing hands at the price of $29,486, which represents a 2.20% gain in the last 24 hours and an increase of 1.09% across the previous seven days, although it is recording a loss of 3.78% on its monthly chart, as the recent data indicates.
Meanwhile, crypto trading expert Michaël van de Poppe has stated there might be a case for Bitcoin declining to $12,000 or retesting at the lows, but that a similar situation had occurred in 2019 when indicators suggested that Bitcoin had to retest $3,000 and go to $2,000 when it was trending up.
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