Former Goldman Sachs executive Raoul Pal said the potential downside in the stock market could threaten crypto prices in the coming months.
Pal said he’s examining the Nasdaq and noted that from a technical analysis standpoint, the index is on the verge of potentially making lower lows if its critical support is broken.
“Failure to hold on stocks revealed serious downside risks if the low level was removed.”
Pal warns that new lows are not certain for the crypto markets, but current macro conditions imply a major correction is coming that could also bring digital assets down.
“We can use energy stocks, petroleum commodities, etc. seeing it in red starts to increase the risk of a complete ‘correlation’ of an accelerated panic. The only place to hide will be dollars and possibly bonds (because everyone is short). And yes, this also catches crypto (not new lows).”
Pal, in a new interview with Real Vision, thinks there will be more noise within an overall changing market structure if the crypto ever comes to the correction phase.
“I’m looking for this downside to layer the positions of the things I want to enter… Frankly, crypto will catch on and fall further but I guess we’re all used to the ups and downs of that.”
5170
