Top strategist says if Bitcoin doesn’t rally now, something needs to go “really wrong”

Top strategist says if Bitcoin doesn’t rally now, something needs to go “really wrong”

Photo by Josh Rangel on Unsplash

Bitcoin has been on a sharp recovery since the March lows of $3,700. Even after a brutal rejection at the $10,500 resistance level, the asset is still up more than 160 percent from the lows, outpacing any other multi-billion-dollar, investable asset — save for Ethereum anyway.

Although many have prescribed as the aforementioned rejection as a death knell of the multi-month bull trend, a prominent strategist says that if Bitcoin doesn’t continue to rally, something needs to go “really wrong.”

That’s to say, BTC is almost confirmed to continue to rally higher due to a convergence — a “perfect storm” — of technical and fundamental factors.

Bitcoin is almost confirmed to rally higher, analysts say

On Jun. 2, Bloomberg senior commodities strategist Mike McGlone released his latest monthly report on the cryptocurrency market.

Like the past five reports McGlone released on the topic of Bitcoin, he held a bullish tone, going as far as to say that “something needs to go really wrong for BTC not to appreciate” as aforementioned.

Bitcoin image bloomberg
Cover of Bloomberg’s June crypto report from analyst Mike McGlone

The analyst’s bullish sentiment boiled down to a confluence of factors, which are as follows:

  • Bitcoin is outperforming the “Crypto Gaggle,” showing that it is on bull market footing. Altcoins may eventually follow suit.
  • The cryptocurrency continues to mature into “digital gold” as this has been a year of “unprecedented central-bank easing.”
  • Bitcoin’s price action is “mirroring” price action seen after 2016’s halving. BTC continuing to follow this historical trend will allow the asset to “approach the record high of about $20,000 this year.”
  • Volatility is decreasing due to rapidly increasing futures and options adoption, keeping prices “tilted toward appreciation.”
  • Bitcoin has the “highest-for-longest 52-week correlation and beta ever” with gold. With gold expected to increase due to the aforementioned money-printing, BTC should follow.
  • Grayscale Investments is absorbing a massive supply of BTC.

The macro trends have been so bullish that Peter Brandt, a prominent commodities trader and Bitcoin bull, opined in March that he thinks this macroeconomic and geopolitical environment is the “perfect storm” for BTC. That’s to say, if the cryptocurrency doesn’t rally now, the industry is in “BIG trouble.”

There’s still the risk of the S&P 500 crashing

These macro factors aside, a sentiment among many is that if the S&P 500 starts to crash again, so too will Bitcoin.

Arthur Hayes, chief executive of crypto derivatives platform BitMEX, wrote in a recent edition of his newsletter “Crypto Trader Digest”:

“Bitcoin will be owned unlevered. Could the price retest $3,000? Absolutely. As the SPX rolls over and tests 2,000 expect all asset classes to puke again. As violent as the Q1 collapse in asset values was, we have almost 100 years of imbalances to unwind the ancien régime.”

Bitcoin

6 Jun at 7:58 am UTC

$9,627.17

-1.67%

Bitcoin, currently ranked #1 by market cap, is down 1.67% over the past 24 hours. BTC has a market cap of $177.1B with a 24 hour volume of $24.02B.

Bitcoin Price Chart

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