According to senior commodity strategist at Bloomberg, Mike McGlon, the price of bitcoin may be poised for a bullish rebound this year as the market exhibits characteristics of a market bottom from 2018.
Mike McGlone, the senior commodity strategist at Bloomberg, predicts a rise in the price of Bitcoin (BTC) in the second half (2H) of 2022.
On July 6, McGlone tweeted his observations to his 48,100 followers and noted that the Bloomberg Galaxy Crypto Index (BGCI) and the 50-week and 100-week moving averages of the price of BTC showed encouraging trends. He asserted that the indicators right now are resembling those from the bear market’s bottom in 2018, which came before a robust recovery in the first half of 2019.
“With the Bloomberg Galaxy Crypto Index nearing a similar drawdown as the 2018 bottom and Bitcoin’s discount to its 50- and 100-week moving averages similar to past foundations, risk vs. reward is tilting toward responsive investors in 2H.”
The BCGI is made to assess the performance of the biggest crypto assets in order to get a broad sense of the market’s performance as a whole. The average price of an asset over a given period of time, such as 50 or 100 days, is determined via moving averages.
According to data from Coingecko, the Crypto Winter of 2018 was difficult for BTC as the price fell precipitously from the $16,000 region in January to a market low of about $3,200 by mid-December. But after the destruction, BTC continued to rise, reaching about $13,000 by late June.
In a follow-up piece, McGlone asserts that Bitcoin is either headed for “one of the biggest bull markets in history at a reasonably discounted price to start 2H” or that evidence indicates the cryptocurrency market is beginning to tank and frighten off investors.
“Our bias is [that] Bitcoin adoption is more likely to continue rising,” he said.
McGlone compared the washout in 1H to the “bursting Internet bubble” of 2000–2002, which caused many businesses to fail but also opened the door for the expansion of well-known enterprises like Amazon and eBay.
The reality that the negative conditions have mostly been a reaction to the U.S. Federal Reserve’s aggressive monetary policy and attempt to reel in inflation through a series of interest rate hikes, however, hangs over the research.
In 2022, macro forces including the Russian invasion of Ukraine, worldwide legislation, and unemployment rates hurt BTC as well as the entire crypto sector. The collapse of cryptocurrency projects and businesses has since made people’s attitudes even more negative.
On June 5, McGlone stated that as the government strives to prevent a recession, the next interest rate hike from the Fed of 75 basis points in June could be the last one of the year if the stock market continues to decline with the “same velocity as in 1H.” As investors return to the market as a result, asset classes may experience a bounce.
