Real Vision CEO Raoul Pal believes that the institutional forces driving the recent crypto market volatility have ended profit-taking and are opening the doors for digital assets to get the new year off to a strong start.
In a YouTube interview with The Stakeborg Talks, Pal identifies the marginal drivers of the current crypto markets.
“I step back and look at this and wonder who is currently the marginal driver of this market?
It’s not retail. Why not? The new Wallet-Addresses and so on are below their highs now, and I think it has to do with this consumption problem.
They have raised retail prices on fuel … energy fixed costs, so their marginal investment capacity has decreased as has [the ability to] consume.”
the inflation of retail prices, Pal argues, has taken insignificant crypto investment money off the table so that only institutional players can influence market prices.
Pal points out that many large investors have incentives to take profits at the end of the calendar years.
“So you’ve taken marginal money out of the market.
When you took it [retail traders] out, and then the institutions are at the end of the year and they have other incentives …
Again, they don’t say they don’t believe in the market, they say I believe in getting paid.
And that’s why I want to protect my profits. “
The result, says Pal, is a mixed market. However, the macro guru believes profit taking may have ended last week.
“This created a one-sided market.
Now the question arises: are you done?
It looks like they’re done because since last week the market has been pecking at what the traditional last week was when everyone got their books in order. “
Still, Pal warns that the correction of the crypto market may not be complete. Regardless, he still predicts a strong start for crypto in 2022.
“Could possibly have another leg lower.
Could this be coming from Asia, where do a lot of sales come from?
Again, possibly … but the likelihood is next year will be a strong start. “
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Source: Crypto News Deutsch