According to ChainCatcher, Bloomberg Intelligence senior commodities strategist Mike McGlone wrote that Bitcoin’s bear market could offer a signal for gold and other risk assets. He said U.S. President Donald Trump’s shift from opposing to supporting crypto helped him win reelection in 2024, but Bitcoin has now peaked and declined; historically, other risk assets could follow.
McGlone said Bitcoin’s 50-week moving average indicates a downtrend and that gold also faces downside risk. Gold’s volatility is currently about 2.2 times the S&P 500’s annualized volatility, its highest level since 2007, making it a highly volatile and highly correlated asset, he said. He added that Bitcoin’s bear market could signal a mean reversion in S&P 500 volatility toward its usual 1:1 relationship with gold. Risk assets face significant pullback risks, and the midterm elections could be a decisive factor, he said.