Market participants are continuing to point out that Bitcoin has been going through a series of defining moments. Per the March edition of Bloomberg Intelligence’s (BI) Crypto Outlook Report, 2022 is set to be another major test for the pioneer cryptocurrency.
Bitcoin appears poised to best the stock market
In the report published by BI’s team of analysts led by chief commodity strategist, Mike McGlone, market trends in both the stock market and crypto market were compared.
From the cross-examination, it was noted that two major trends seem to be gaining ground in the Bitcoin market. These were the facts that at the moment Bitcoin is appearing to be giving the Nasdaq 100 index stiff competition, and also recording declining relative volatility.
Using Bitcoin’s 260-day volatility metric, the report pointed out that Bitcoin had about 3x the volatility of the Nasdaq 100. However, the current volatility is nowhere near the amount of volatility that Bitcoin faced back in December 2017 when Bitcoin futures trading launched.
Based on the assessment, the analysts asserted that 2022 could be the year that Bitcoin gains the upper hand over the stock market. This could happen if the stock market enters an “elusive bear market.”
Not partially allocating to Bitcoin as it progresses into the mainstream may remain the greater risk for most asset managers, the report observed.
Notably, the bullish theme of this month’s report carries on from last month. The previous report highlighted that the price of Bitcoin seems to have $100,000 programmed as the next significant level to overcome.
Is Bitcoin breaking away from stocks already?
Bitcoin crashed along with the stock market after Russia declared war on Ukraine, but has been recovering gradually. BI’s report notes that Bitcoin is already showing divergent strength, and breaking away from being correlated with traditional stocks.
The report points out that the week before the conflict began, Bitcoin and the Nasdaq 100 index closed at around $40,000 and $14,000 respectively.
Following the onset of the conflict, the stock market crashed to being down 13% year to date, while Bitcoin fell only 5%. However, Bitcoin seems to already be building support at the $40,000 price level while the stock market seems to be pressing lower.
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The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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Source: https://coingape.com/bloomberg-bitcoin-btc-could-outperform-stcoks-in-2022/