Bitcoin on Brink of Multiyear Low as Federal Reserve Policy Tightens

Bloomberg Intelligence senior macro strategist Mike McGlone warns that Bitcoin is losing its status as 'digital gold' and becoming more like an ordinary stock market asset. According to McGlone, the cryptocurrency's rigid correlation with US equities and the tightening of Federal Reserve policy have created critical downside signals for Bitcoin.

McGlone identifies three pressure factors that have activated bearish signals on the charts:

The price rebound stalled at $76,746, failing to break above the key psychological barrier of $80,000. One-year federal funds futures are pricing in another 70 basis points of Fed rate hikes, draining liquidity from speculative markets. The S&P 500 has moved critically far above its 200-week moving average, sharply increasing the risk of large-scale profit-taking by institutional investors.

McGlone argues that Bitcoin no longer functions as a defensive asset and is now tied to the trajectory of technology stocks due to the dilution of the industry. He calculates that if the S&P 500 enters a natural correction phase and loses 20%, Bitcoin will inevitably plunge toward its long-term fundamental pivot in the $10,000 area.