13 May 2022 14:05, UTC
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Raul Pal compared the current level of panic to the crash in March 2020.
What happened? A former employee of the investment bank Goldman Sachs and the founder of the Real Vision TV channel, Raul Pal, believes that May will be difficult for the digital asset market. In his opinion, cryptocurrencies are facing an “unpleasant recession” and a “large-scale liquidation.” Pal said that the fall in demand in the world market is due to the tightening of monetary policy of the US Federal Reserve System (FRS). Despite the fact that the crypto market is in a “complete panic mode”, the analyst called cryptocurrencies long-term investments. Pal stressed that he sees the coming recession as a “huge opportunity.” He announced this on Twitter.
What else did Pal write? The analyst claims that other markets also expect a fall. Pal noted that layoffs and lower house prices are coming. He stressed that all this is due to the Fed’s increase in the key rate by 50 b.p. According to Pal, stock markets have already estimated the fall in demand, and credit markets are just beginning to realize the scale of the recession. According to the analyst, the next four weeks will be “alarming” for the cryptocurrency market, as all positions will be liquidated. Only bonds will remain relatively safe, but for most people they are short, Pal noted.
What events have happened before? In April, Raul Pal said that changes in the conditions of the world market could provoke the growth of the crypto market. He suggested that if the U.S. economy or the global economy began to weaken, then there would be fewer rate hikes. The analyst added that this will have a good effect on the cryptocurrency.
Forecasts of other experts. In April, Pantera Capital founder and CEO Dan Morehead said that cryptocurrencies are the only asset resistant to Fed rate hikes. In his opinion, digital currencies can become the safest asset class for investors in the event of an economic crisis.
In May, a cryptanalyst known by the pseudonym Pentoshi, predicted price increase bitcoin and shares of technology companies. In his opinion, this should have happened on May 4, after the meeting of the Federal Open Market Committee (FOMC), which is part of the Fed.
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