Bitcoin (BTC)Crypto News

Bloomberg analyst says Bitcoin just traded at its steepest discount ever – allowing BTC to reverse course

Mike McGlone, senior commodities strategist at Bloomberg Intelligence, says that the crypto market crash has recently reached extreme proportions.
According to McGlone Bitcoin (BTC) recently traded at the deepest discount since the calculation of the flagship crypto asset’s 200-week moving average began.

“Bitcoin’s steepest drop on Sept. 20 since its 200-week moving average was calculated shows the extremity of the crypto crash and risk vs. reward for shorts vs. potential resumption of the protracted uptrend.”

According to Bloomberg Intelligence strategist, the US Federal Reserve’s aggressive rate hikes offer a “good reason” for Bitcoin to reverse its downward spiral.

“Our graphics [below] shows a good reason for one of the best-performing assets in history – aggressive US Federal Reserve rate hikes – but it’s a matter of endgame. At about 4.3%, the one-year Federal Funds Future (FF13) has fallen the fastest compared to its 200-week moving average.”
Source: Mikemcglone11/Twitter
The Federal Funds Future is a derivative based on short-term interest rates set by the Federal Reserve. Investors use the derivative to bet on or hedge against short-term interest rate fluctuations.

Regarding the correlation of the crypto market with stocks, McGlone says that Bitcoin and other crypto assets could determine the bottom of the stock market.

“Bitcoin is gaining status as the world’s top 24/7 risk asset and leading indicator that never stops trading. It’s a low-risk year and the cryptocurrency could be a harbinger of how low the stock market could fall. A rapid decline in stock prices is a primary force to reverse expectations of rate hikes.”

Featured image: Shutterstock/Zaleman

Source: Crypto News Deutsch

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