Crypto and stock markets expected to undergo substantial correction, according to 10X Research.
Markus Thielen, the head of research at 10x Research, has expressed concerns about the future prices of risk assets such as cryptocurrencies and stocks. In a note to investors on April 16, Thielen stated that the cryptocurrency market is approaching a critical point that may result in a significant price correction. In anticipation of this bearish event, his firm has sold all of its tech stocks.
Thielen explained that the decrease in rate cuts, the rise in bond yields, and persistent inflation are the factors influencing his pessimistic outlook. This analysis comes after Bitcoin experienced an 11% drop in value over the past week, with a further 6.7% decrease in the last 24 hours. At the time of writing, Bitcoin was trading at $61,988.93. Thielen attributed this drop to diminishing expectations of a cut in U.S. interest rates.
The expectations of unchanged interest rates are in line with the sentiment expressed by market participants, as indicated by CME’s FedWatch tool. The tool shows that 97.5% of participants expect no change in interest rates.
Thielen also revealed that his firm still holds some “high-conviction crypto coins,” although their overall sentiment remains bearish.
This warning from Thielen follows his previous prediction that cryptocurrency miners could sell off $5 billion worth of Bitcoin in the months after the halving event. Based on historical data, he concluded that the crypto market could experience a prolonged period of low activity.
It is important to note that Thielen’s statements and predictions are his own and should not be considered as financial advice. Investors should conduct their own research and make informed decisions based on their individual circumstances.
