The fall in the index of business activity in the US and the tightening of the Fed’s policy will make 2022 “bearish” for bitcoin, says macro analyst Lyn Alden.
American investment strategist Lyn Alden said in an interview with Stansberry Research that the business activity index (PMI) indicates a fall in the value of bitcoin in 2022. Alden explained that she tracks PMI to predict trends in the BTC market:
“Bitcoin has been bullish in 2011, 2013, 2017 and 2020. This coincided with the growth of PMI, that is, the economic acceleration. Thus, now is not the best period for growth in value. Also, right now Bitcoin is classified as a risky asset by most investor pools due to its volatility, so I am not optimistic about 2022.”
The analyst notes that the PMI is now at 58%, down 9.38% from March 2021. A fall in PMI amid tighter monetary policy by the US Federal Reserve could serve as a catalyst for the fall in the value of the first cryptocurrency, Alden believes: “If you encounter market turbulence, as in March 2020, you can regard this as a buy signal. I don’t know if we will collide, but personally I will consider this moment as an opportunity to buy bitcoin. We can certainly see the price drop below $30,000 in this situation.”
However, Alden is optimistic about the crypto industry in the future of three to five years. Initially, these were peer-to-peer exchanges that had problems accessing bank capital, the analyst lists. Then there are cryptocurrency regulated exchanges. And now there are large institutional-grade custodial companies and large pools of investors. Lyn Alden is confident that the trend will continue and will accelerate as society adopts cryptocurrencies.
Stefan Rust, founder of the Sonic Capital cryptocurrency fund and Hydro Labs financial incubator, said that in 2022 investors will face a fall in the cryptocurrency market. In his opinion, after the growth cycle, this will not be unusual. Galaxy Digital founder Michael Novogratz even offered a $1 million bet that BTC would not trade below $35,000. However, stock trader and blogger Justin Bennett believes the market is still in a “bullish trend.” and a reversal for bitcoin can only begin with a fall in the dollar index.
