Summary

  • Mike McGlone said Bitcoin has turned lower and that, based on past patterns, other risk assets could follow.
  • He said Bitcoin's 50-week moving average is pointing to a downtrend, while annual gold volatility is running at about 2.2 times that of the S&P 500, the highest level since 2007.
  • He added that Bitcoin's bear market is signaling higher volatility in the S&P 500 Index, that downside risks are rising across risk assets, and that the U.S. midterm elections will be a key variable for the market's next direction.

Forecast Trend Report by Period

Bitcoin's weakness could spill over into other asset markets, including gold and stocks, according to Mike McGlone, a macro strategist at Bloomberg Intelligence.

Writing on X, formerly known as Twitter, on Nov. 7, McGlone said Bitcoin has turned lower and that other risk assets could follow based on past patterns.

He pointed to Bitcoin's 50-week moving average as a sign of a downtrend. As Bitcoin's decline becomes more pronounced, gold may also be nearing a turn lower, he wrote.

McGlone also cited unusually high volatility in gold as a risk factor. Gold's annual volatility is now about 2.2 times that of the Standard & Poor's 500 Index, the highest level since 2007, according to him.

Bitcoin's bear market is signaling that the S&P 500 could return to its long-term relationship in which volatility runs at levels similar to gold, he said. That suggests stock-market volatility could also increase.

He added that downside risks are rising across risk assets and that the U.S. midterm elections will be a key variable in determining the market's next direction.

Uk Jin