A veteran Wall Street investor and market strategist is making a bold call on Bitcoin (BTC), going as far as to stake his reputation on it.
In a new CNBC interview, former Morgan Stanley managing director Jordan Visser says he expects the largest cryptocurrency by market cap to soar to much higher levels the next time he appears on the program.
“I’ll put my neck out on the line here and say the next time I see you, Bitcoin will be significantly higher.”
Visser says his conviction is based on three converging factors, creating a rare alignment that will likely power BTC’s next leg up.
He first mentions the break in the three-year correlation between Bitcoin and software stocks.
“Last week, Bitcoin outperformed software significantly. If you go back to when the stock market started to rally, we saw breaking correlations between crude trading higher by $11, and yet the S&P 500 finished slightly up or unchanged on a Friday. Software was down hard last week, but Bitcoin was up. I think we broke that correlation.”
Visser says another important catalyst is the emergence of negative real interest rates, which occur when inflation is higher than the interest rate.
“We’re getting into negative real rate territory. Year-over-year, CPI is now at 3.3%. The next time we get a CPI print, you’re going to have year-over-year CPI above where three-month [Treasury] bills are. The best returns for Bitcoin have been when we’ve had negative real yields.
I think we’re going to be in a situation with negative real yields for quite some time, because I don’t think inflation is going to come down sharply. And I think we’re going to have a problem with how the Fed is going to deal with inflation, with slowing growth and with the affordability issue. So all of these things feed into a very positive backdrop for Bitcoin.”
And Visser says Bitcoin’s moving average convergence divergence (MACD), a momentum indicator, is flashing a bullish signal.
“You have some positive technical signals with a weekly MACD crossover. I’m going to go with Bitcoin’s higher the next time I see you.”
Bitcoin is trading at $74,635 at time of publishing.
Photo by Kanchanara on Unsplash
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