Seasoned investors and financial experts agree that the United States is headed for a recession, according to Bloomberg’s senior commodities expert Mike McGlone. Meanwhile, some asset classes may outperform others as the economic depression unfolds. At this point, McGlone points to another asset other than Bitcoin. Here are the details…
McGlone: Gold can surpass Bitcoin (BTC)
McGlone made a post on May 7. He pointed to a chart that shows the 100-week moving average (MA) of both gold and Bitcoin. During this recession, gold is in a more advantageous position compared to Bitcoin (BTC), especially if the stock market is falling. McGlone uses the following expressions:
The momentum and the US’s tendency to enter recession could give gold an advantage over Bitcoin in 2023, especially if the stock market falls. For crypto, the upward move of the metal against the dips is the current trajectory on a 100-week basis, and the key question is what will stop the trend.
Interestingly, as the Fed increased interest rates by 25 basis points to 5.25 percent, which is the highest level of the last two decades, as we reported on cryptokoin.com, pointing to its correlation with rising interest rates, gold had previously been sold per ounce. It rallied strongly to $2,052. According to the latest information from the BullionVault platform, gold was trading at $2,023 per ounce. This price is almost $30 lower than its peak a few days ago. But it’s still 0.74 percent or $17 higher than a month ago.
Bitcoin price analysis: What’s next?
As for Bitcoin, commodities expert McGlone stated that the biggest cryptocurrency “staying above the $30,000 resistance will be the first indication that the tide is turning for all cryptos. However, he stated that the summit seems to be getting stronger as of May 2. “We see that the stock market and the high correlation between risk assets and gold put Bitcoin in a vulnerable position in early May,” McGlone added.
Indeed, according to the latest data, Bitcoin is currently changing hands at $27,500, down 0.8 percent on the day and 2 percent over the previous week. Finally, as McGlone points out, “the soft landing and the consensus that the worst is over is something similar in stocks and cryptos.” He claims these are signs of an uptrend. Bloomberg Economics’ recession forecasts have shifted towards July.
Meanwhile, Albert Edwards, Société Générale’s strategist, notes that “the official US leading indicator tells us that a recession will happen today, not tomorrow, not next week.” He believes this will “lead to a collapse in margins and profits.” He also advocates for stocks, which are likely closely related to corporate profits and earnings.
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