Commodity strategist Mike McGlone predicts recession as top catalyst for gold rally above $2,000 – Markets & Prices Bitcoin News

This week, Bloomberg Intelligence senior macro strategist Mike McGlone shared his outlook for March, noting that the “peak catalyst” that could push gold above the $2,000-per-ounce range is a recession. McGlone further explained in an update on bitcoin and Nasdaq that a key ingredient to force the US Federal Reserve to change its stance is “a sharp drop in the stock market.”

Mike McGlone shares March outlook for precious metals and cryptocurrencies

Gold and silver prices were lower in the past week, with gold close to falling below the $1,800-per-ounce range and silver clinging just above the $20-per-ounce range. The global cryptocurrency market capitalization today is $1.08 trillion, down about 1.57% over the last day. Earlier this week, Bloomberg Intelligence Senior Macro Strategist Mike McGlone shared its predictions in March for assets such as commodities, precious metals, stocks and bitcoin. Regarding bitcoin, McGlone questions whether the recent rally was hollow or a lasting recovery.

The Bloomberg analyst noted that “cryptos have never faced a US recession, Fed tightening and bitcoin 50-week moving average below 200-week.” McGlone detailed that at some point most risk assets will bottom out, but with the US Federal Reserve still in tightening mode, most markets have bounced back. “Bitcoin’s 50-week moving average has never crossed below its 200-week level amid Fed tightening, and the crypto has bounced to this line in the sand at around $25,000,” McGlone said. The macro strategist added:

Rapid snap-backs are typical of bear markets, and if bitcoin can sustain above $25,000, it will signal diverging strength relative to the central bank.

As for gold, the precious metal has a good chance of reaching $2,000 per unit if the US economy enters a recession, McGlone meant. “The biggest potential for economic contraction from the roughly 30-year yield curve and the Federal Reserve’s continued tightening could lead most metals lower and gold higher in 2023,” the strategist wrote. “A US recession is a top catalyst that could push the metal price above $2,000 an ounce.” Also, the chances of a recession look likely according to McGlone’s data.

“Based on the highest probability of recession from the three-month to 10-year yield curve in our database since 1992,” the strategist said. “One key factor that could be different this time around is the Fed easing that markets were used to until 2022 inflation.” Furthermore, McGlone believes that gold jumps may not happen until the Fed decides to commit to monetary policy tightening. “One of the best performers on a 12-month basis, the precious metal could snuff out a potential Fed pivot due to recession,” concludes McGlone’s March outlook.

Do you think the US economy will slide into a recession, and if so, what impact will that have on the price of gold and other assets such as cryptocurrencies? Share your thoughts in the comments section below.

Jamie Redman

Jamie Redman is the news editor at Bitcoin.com News and a financial technology journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open source and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today.