Bloomberg senior strategist Mike McGlone published an alarming macroeconomic forecast. According to his report, the overheating US stock market threatens a deep drop for Bitcoin.
“The US stock market is trading at a century-high valuation with record-low volatility. The crypto market is falling as political hype fades,” he stated.
While liquidity flows into gold and silver at the fastest pace in half a century, a volatility spike will inevitably hit equity indices, stripping Bitcoin of any chance to hold its current levels amid a broader traditional market collapse.
Target Drop Levels
The analyst believes an initial mean reversion will push the S&P 500 down to 5600 points, simultaneously dragging Bitcoin to the $56,000 mark.
The long-term macroeconomic scenario anticipates a total capitulation of the crypto market, as US stock indices hitting a historical ceiling could send the coin crashing down to $10,000.
The peak of the current bull cycle will see the S&P 500 lock in at 7000 points, while the Dow climbs to 50,000 points.