Mike McGlone is a commodities analyst at Bloomberg Intelligence. He released a report on the company’s commodities and cryptocurrency outlook over the past two days. According to McGlone’s latest analysis, the gold price could continue to rise after setting a similar foundation to his 1999.
Regarding Bitcoin and Ethereum, analysts claim that the top two cryptocurrencies will “outperform most major assets” when “the tide turns in the economy.” Commodity strategist Mike McGlone said,
“We recognize the risk of prolonged deflation in favor of gold.”
Mike McGlone said gold, Bitcoin (BTC), and Ethereum (ETH) are currently forming the bottom prices. If the economy returns to better levels, it could be three or three. Gold is below the precious metal’s all-time high of $2,070 but is currently above its nominal range of $1,700 an ounce. McGlone said gold is now setting a similar base to the market’s performance in 1999.
Bitcoin (BTC) and Ethereum (ETH) Are Currently Forming the Bottom Prices
At the time, gold was nominally priced at $250 an ounce. It was never going below $250. A senior commodities strategist at BI believes this trend could repeat itself. According to the strategist,
“The divergence between dollar-denominated gold and euro-denominated gold is approaching levels that provided a sustained foundation for metal prices in 1999….” About 10% by September 2022. On the 28th, dollar gold matched the euro and yen gains of 5% and 10%.”
According to the commodity strategist,
“Aggressive Fed tightening to address inflation and elevated asset prices — buoying the greenback, as the rest of the world tries to catch up — echoes trends about two decades ago. Underpinnings are firming for the price of gold to resume the rally that started with that base”.
McGlone said the gold price rally “indicated stresses that could disrupt a series of rate hikes by the Federal Reserve.” McGlone thinks it could be a catalyst for reopening.
“The relative discounting of the gold spread between the dollar and the euro highlights currency concerns. This suggests a potential catalyst for a gold bottom–waning Fed rate hike expectations,” said the BI report.
McGlone believes the digital asset has the potential to rise in resistance levels up to 100 times that of gold. The current resistance level of BTC ($40,000) is 22 times higher than gold ($1,800). During the 2017 bull market, the Bitcoin to gold price ratio surged from 1x to 15x in months.
Bloomberg Intelligence Report: Bitcoin, Ethereum, and BGCI Could
Outperform Most Major Assets
McGlone and his market strategist Jamie Douglas Coutts released BI’s October crypto outlook. Two analysts believe Bitcoin and Ethereum will outperform most of today’s assets as the economy changes.
A recent report from The Strategist highlighted that “Bitcoin, Ethereum, and the Bloomberg Galaxy Crypto Index (BGCI) tend to outperform most major assets as the tide turns in the economy.”
The cryptocurrency report mentions that the rate hikes are a potential threat. This could create strong headwinds for the top two assets. “However, benchmark cryptocurrencies could become risk-free assets like gold and Treasuries in the second half,” McGlone said that October is usually a bullish month for BTC, in contrast to September’s dismal price action.
