Bitcoin is losing its status as independent digital gold and is becoming increasingly dependent on the stock market, reports senior macro analyst Mike McGlone from Bloomberg Intelligence. In his new review, he emphasizes that its clear correlation with U.S. equities and the imminent tightening of Federal Reserve policy create critical signals for the leading crypto asset, potentially leading to a drop to a multi-year low around $10,000.
Bloomberg Intelligence's analysis highlights three pressure factors triggering bearish signals on the charts: firstly, the price of Bitcoin stalled at $76,746, failing to break through the key psychological mark of $80,000. Secondly, future federal funds contract rates for one year indicate a possible interest rate hike of 70 basis points, which is draining liquidity from speculative markets. Thirdly, the S&P 500 index significantly exceeds its 200-week moving average, increasing the risk of large-scale profit-taking by institutional investors.
According to McGlone, Bitcoin no longer serves as a safe-haven asset. Over the past five years, its returns have only matched those of the S&P 500, while exposing investors to nearly three times greater volatility. This calls into question Bitcoin's effectiveness as a safe haven. If the S&P 500 enters a phase of natural correction and loses 20%, Bitcoin will inevitably drop to its long-term fundamental level of around $10,000. However, this situation could change if Bitcoin proves its independence and begins to rise despite falling stocks — so far, macroeconomic indicators point in the opposite direction.
Related articles
