Bitcoin is on its way to becoming global collateral Bloomberg’s analyst Mike McGlone has often maintained. He has reiterated that Bitcoin’s sustained buoyancy in the face of all the market-moving events happening points to Bitcoin’s unstoppable rise.
Bitcoin’s divergent strength in play vs Nasdaq 100
In Bloomberg Intelligence’s latest analysis, McGlone and Jamie Douglas Coutts, Bloomberg’s senior market structure analyst, have examined just how Bitcoin is fairing in its journey to ultimate dominance.
One sign of Bitcoin’s growing acceptance is its outperformance of the equities market. The analysts noted that so far in 2022, the crypto market was showing more stability than the Nasdaq 100, the popular stock market index.
Bitcoin, despite its characteristic volatility, seems to be on its way to breaching key resistance at its 50-week moving average, the analysts observed. If the price of Bitcoin sustains above $46,300 for the year while the Nasdaq 100 stays down by 8%, it could mark an inflection point for the pioneer crypto. This would also result in equities being more likely to trade lower and Bitcoin’s buoyancy outlasting it.
Bitcoin’s dominance and divergence from risk assets will be inadvertently helped by rising inflation and the Fed’s attempt to reign it in.
Every day that the Federal Reserve wakes up to rising asset prices, our take is it becomes more concerned about related inflation and inclined to do something about it. Bitcoin is poised to come out ahead of what may be an overdue mean reversion for risk assets, the analysts said.
Bitcoin also wins vs commodities
In the opinion of the analysts, Bitcoin has advantages and hence is also poised to outperform commodities as well. One of the advantages Bitcoin holds over the asset class is its undisruptable trading. McGlone has previously highlighted this when he called Bitcoin “the most significant, fluent, widely- traded 24/7 asset ever on the planet.”
Bitcoin has never suffered the kind of drama commodities have like the recent case of the suspension of the trading of Nickel by the London Metal Exchange (LME) and the probe that has followed the exchange.
McGlone and his colleague said: “Constant price discovery without distortions, limits or central-party control are attributes of blockchain-based assets like Bitcoin, and the money is migrating to where it’s treated best.”
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.