Bloomberg Strategist: Bitcoin's Bear Market May Signal Further Declines in Stocks and Gold

Nov. 7 — Mike McGlone, senior commodity strategist at Bloomberg Intelligence, wrote that Bitcoin's bear market may offer guidance for gold and other risk assets. He argued that Trump's shift from a crypto opponent to a supporter helped him win re-election in 2024, but Bitcoin has now peaked and rolled over, and if history is any guide, other risk assets may follow it lower.

McGlone noted that Bitcoin's 50-week moving average indicates a downtrend, while gold also faces the risk of moving lower. He said gold's current volatility is about 2.2 times the S&P 500's annualized volatility, the highest since 2007, making it a highly volatile and highly correlated asset. In his view, Bitcoin's bear market may signal that S&P 500 volatility will mean-revert toward its usual 1:1 relationship with gold. McGlone concluded that risk assets currently face considerable downside risk, and the midterm elections could be a decisive factor.