Asset prices are being pressured lower by global rate increases, but BTC is beginning to beat commodity and tech equities. Mike McGlone, a lead commodities analyst at Bloomberg Insight, said that Oct has traditionally been the greatest month of BTC, with gains of approximately 20% on average for the season. He also suggested that the peaking of commodities may indicate that BTC has found its bottom.
McGlone claims in a Bloomberg Cryptocurrency Outlook article from October 5 that, despite negative pressure from rising interest rates throughout the world on most commodities, Bitcoin is making headway on commodity and tech equities like Tesla.
McGlone points out that especially in comparison to the Bloomberg Commodity Index, which monitors changes in the prices of goods and services like gold as well as crude oil, Bitcoin has its smallest volatility ever. He further implies that traditionally, when a cryptocurrency is headed for new highs, Bitcoin uncertainty is more likely to rebound than that of commodities.
BTC Will Outperform Major Assets In 2022:
Following minimal turbulence through Sept and a likely high in commodities prices, McGlone predicted that Bitcoin “transition toward being a danger asset and The us Treasury’s” in the second half of 2022.
Since its volatility makes it a hazardous asset that traders are inclined to sell in a setting where buyers are eager to minimize exposure, Bitcoin has historically had a strong correlation with tech stocks.
The idea that BTC may be changing to behave very much like “virtual gold” is supported by Kaiko Research data, which was published on October 4. After a rise of the US dollar as interest rates rose Bitcoin’s correlation to gold reached its highest point in more than one year at +0.4.
When two entities have a correlation of +1.0, their movements are equivalent. For instance, if gold and bitcoin had a correlation of +1.0, a 10% gain in gold would be mirrored by a 10% rise in bitcoin.