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In a recent interview, financial analyst Scott Melker downplayed concerns surrounding Bitcoin’s(BTC) price correction, highlighting positive factors that could signal a continuation of the bull market.
Melker, joined by Mike McGlone, Senior Macro Strategist at Bloomberg Intelligence, spoke with Gareth Soloway about the recent inflation data and its impact on Bitcoin. The interview comes after the release of Consumer Price Index (CPI) data showing a minor decline for the first time in four years.
While this decrease is modest, it has fueled expectations for a potential Federal Reserve (FED) rate cut, leading to a selloff in tech stocks. Melker, however, believes this is a sign of market rotation rather than capital flight.
Bitcoin Within Historical Correction Range
Regarding Bitcoin‘s price, Melker pointed out that the current correction of around 27% falls well within the range observed in previous bull markets, where corrections typically reached 35% to 45%. He acknowledged the possibility of further dips but expressed confidence in the long-term trajectory.
Melker emphasized the importance of Bitcoin reclaiming the 200-day moving average to bolster market sentiment. Despite potential short-term volatility, he identified several positive factors for cryptocurrency, including the upcoming US elections, growing political support for cryptocurrencies, and the anticipation surrounding the next Bitcoin(BTC) halving event. He also highlighted Bitcoin’s potential for decoupling from traditional equity markets and stressed the importance of patience during market slowdowns.
McGlone on Rate Cuts and Broader Market Trends
McGlone weighed in on the possibility of a rate cut, suggesting the market increasingly anticipates a dovish turn from the FED. He pointed to the rising unemployment rate as a potential justification for a rate cut in September, while acknowledging the need for further data analysis.
Also Read: Germany Dumps 82% Of Seized Bitcoin In Fire Sale – Market Tumbles
McGlone characterized recent economic data as temporary fluctuations within a larger macroeconomic picture. He noted that the market swung excessively towards recession fears last year and is now correcting that course, finding a more balanced position.
While acknowledging Bitcoin’s(BTC) earlier positive performance this year, McGlone suggested the recent weakness reflects a need for a broader market pullback to allow for consolidation. He identified potential breakdowns in commodities, particularly grains, as signs of a potential correction across equities, Bitcoin(BTC), and bond yields, with the latter potentially influenced by trends in China.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
