Bitcoin Faces $10K Reversal on SPX Sell-Off

Bitcoin's recent surge may be short-lived according to Mike McGlone, senior commodity strategist at Bloomberg Intelligence. McGlone warned that high stock prices and upcoming interest rate hikes suggest bitcoin's price may retrace meaningfully to $10,000, serving as a leading indicator of a risk-asset drawdown.

McGlone stated that the surge of the $80K level as resistance, pricing of 0.70% in hikes by Fed funds futures for the next year, and high valuation of the SPX compared to its 200-week moving average may draw Bitcoin's price lower.

He called bitcoin 'a dud' due to its high correlation with the SPX, especially when beta declines, and its position as the first cryptocurrency now competing with millions of others. McGlone also mentioned that proving this scenario wrong may require the crypto to sustain divergent strength.