Crypto Expert Believes This One Catalyst Can Trigger New Bull Market – Market Rebound Incoming?
James Butterfill, head of research at digital asset manager CoinShares, argues that there is one catalyst that could take bitcoin (BTC) and the crypto market straight into the next bull run – a Fed pivot.
In an interview with trader and investor Scott Melker, aka the Wolf of All Streets, Butterfill said that, if the US Federal Reserve (Fed) – the country’s central bank – pivots from its hawkish position, the USD may weaken and a BTC bull run may restart.
He argued that BTC and equities were highly correlated at the beginning of the year, and it was “nothing to do with [BTC] being a risk asset,” but the Fed was being really aggressive, which increased the correlation.
The executive stated that,
“Until the Fed backs off, […] we’re not really going to see any kind of measurable rise in the bitcoin price.”
Important indicators to look out for, for any kind of a measurable rise, he said, would be early signs that usually show a “real weakness” in the economy.
Explaining his opinion further, he said that there has been a divergence in bitcoin-equities correlation in a short amount of time recently – which will continue – and the reason is the growing narrative where people are seeing the Fed as an entity that’s pushing them into recession due to policy mistakes.
The host and the guest argued that the Fed pivot is likely inevitable, and that the bear market is transitory, with Butterfill adding that he spent a long time looking at positioning in the dollar, stating that, among other things, the US Dollar Index (DXY) is very high, and the Commodity Futures Trading Commission futures positioning is elevating, which is “highlighting quite elevated long position for the dollar.”
He concluded that,
“So we know the dollar is very overvalued.
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