Bitcoin Shows “Divergent Strength” Against Nasdaq, Says Bloomberg’s Mike McGlone


Alex Dovbnya

Mike McGlone Believes Bitcoin’s Growing Divergent Power Is a Positive Development Ahead of a Potential Nasdaq Bear Market

Mike McGlone, senior commodities strategy at Bloomberg Intelligence, pointed to Bitcoin’s growing divergent strength against the tech-heavy Nasdaq index.

The largest cryptocurrency is down about 15% since the start of the year, while the Nasdaq is down 20%, despite the former being three times more volatile than the latter.

McGlone believes this bodes well for Bitcoin as stock market investors brace themselves for what appears to be another bear market.

The analyst says that financial markets are currently in a risk-free environment as a result of the Federal Reserve’s plan to tighten monetary policy.

The Fed is expected to raise the short-term interest rate benchmark for the first time since 2018. The much-anticipated decision will be announced Wednesday after the Federal Open Market Committee (FOMC) meeting. Analysts are confident that the central bank will approve a 25 basis point hike, but it is highly unlikely that the tightening will stop there.

With US inflation hitting its 40-year high, the Fed is poised to aggressively withdraw support. Multiple rate hikes are very likely this year if the problem persists.

McGlone argues that the tightening is not good in the short term. He may see Bitcoin fall back to the $30,000 support level before continuing to grind higher.

The largest cryptocurrency is currently trading at the $39,000 level on major spot exchanges. It is 42.49% lower than the record high.

Image by tradingview.com

As reported by U.Today, McGlone recently said that Bitcoin price was still heading towards $100,000.

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