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The former Goldman Sachs executive shared his plan to buy cryptocurrencies on the downside and discussed possible scenarios for economic inflation.
- Raoul Pal presentó un análisis macro de la situación actual que golpea los mercados.
- He reviewed the 1974 and 2008 crises as analogies for current U.S. inflation.
- He advocated buying crypto on the downside, and keeping a long-term perspective.
En medio de los temores frente a la pronunciara caída en el mercado de criptomonedas, el inversionista y empresario Raoul Pal ha compartido su análisis desde una visión macroeconómica, así como su propio plan de acción para comprar a la baja.
In a child of tweets Tuesday, Pal, who was formerly a sales executive for Goldman Sachs in Europe, was not surprised by the overall bearish outlook, which encompasses both cryptocurrencies and global equity equity is the funds that would be returned to a company's shareholders if all of the company's assets were dissolved and all debts were paid off in the event of liquidation. markets. The investor and CEO of Real Vision described how this phenomenon is the product of a number of factors including high U.S. economic inflation, the Federal Reserve’s (Fed) rate hike response and heightened fears of an economic recession.
“ As the world’s most important security, U.S. Treasuries, suffers unprecedented volatility, margin calls are everywhere. “, Pal wrote, summing up the bigger picture.
When the world’s most important collateral, US treasuries, undergo unprecedented volatility, margin calls are everywhere. When the position you borrow to invest investing is when you put money in a financial scheme with the intent of making a gain. in has massive volatility a statistical measure of dispersion of returns, measured by using the standard deviation or variance between returns from that same security or market index. too, there are even more margin calls.
Welcome to 2022. 1/
– Raoul Pal (@RaoulGMI) June 14, 2022
It should be noted that Treasury bonds are considered a risk-free investment. The “margin call” refers to when an investment operation runs out of funds, often due to losses, forcing traders to deposit funds to meet the minimum maintenance margin.
A macroeconomic analysis
Taking a look at history, Pal also weighed several possible courses of development for the inflation scenario. He cited, as an example, the crisis that the United States experienced in the 1970s. Pal said that the manufacturing index (ISM) is a key variable for the analysis, as well as the CPI, the most widely used index to measure inflation.
In an earlier post, the investor had also weighed in on what happened in 2018, by way of analogy. “ Financial conditions were very tight and growth collapsed, leading the Fed to pivot. Once again, there was a sharp final sell-off in stocks. “he wrote about the situation that year. He also reviewed the inflation of 2001 and the central bank’s actions by then.
In his most recent analysis, he pointed to the possibility that the current situation could lead to “ a prolonged recession like the one in 2008 “. Pal stressed that, in his view, the central question is whether the picture will become more like that of 14 years ago, when the “ market an area or arena, online or offline, in which commercial dealings are conducted. rebounded and fell again as yields were crushed “, o si será una recesión “ fast and furious as the 1974 “.
“ The probability for me is that 1974 is the best guide we have. In the last four months of 1974, inflation a general increase in prices and fall in the purchasing value of money. was still rising but the ISM fell from 56 to 30! Equities plummeted. The Fed cut “he said. However, he also added:
It is too early to tell. My guess is that the bond market will tell us.
Pal will buy Bitcoin on the downside
Overall, the businessman was not overly optimistic, admitting that in situations like the current one, investors are more likely to generate losses than gains gains refer to an increase in value or profit. on their investments. However, he noted that those with long-term strategies may have a better chance of winning.
Everybody is waiting for what’s going to break. My guess is it’s the U.S. economy[…] Good luck out there. There are no sure bets. But for long-term investors, things are starting to get more interesting.
Despite the discouraging bearish outlook, Pal believes there are still attractive opportunities. In a tweet , el inversionista compartió un extracto de una de sus publicaciones recientes para Exponential Age Asset Management (EXPAAM), a cryptoasset a cryptoasset is any digital asset that uses cryptographic technologies to maintain its operation as a currency or decentralized application. firm he co-founded last year. In the reporte Pal reviewed his own experience as an investor in the digital digital technologies are these electronic tools that have the ability to generate, store or even process data. currency currency is a medium of exchange that defines value. market and detailed the importance of taking a long-term view in order to succeed in this sector.
The investor recommended looking at the five-year exponential moving average of Bitcoin the biggest and most popular cryptocurrency in the world. It is a decentralized digital currency that enables users to make trustless peer-to-peer transactions. and noted that the price of the flagship asset does not normally spend more than 30 days below this critical level. In a tweet earlier, he had also expressed that he saw the level below USD $23,000 as a buy signal signals are a call to action to either buy or sell an asset. for the Bitcoin.
Same applies to crypto which has been constrained by the macro.
I am a significant buyer (for me) into any further weakness…these chances dont come often and they are life changing. The 60 month Exponential Moving Average comes in at $22,500. This is the add zone. pic.twitter.com/mO7bamIB4a
– Raoul Pal (@RaoulGMI) May 30, 2022
“ These opportunities don’t come along often and they are life-changing. “Pal commented on the market downturn. “ The 60-month exponential moving average is at $22,500. This is the buy zone “, he added, hinting that he is preparing to accumulate more cryptocurrencies in the midst of the cryptowinter.
I am preparing to significantly increase my cryptocurrency positions. Probably from next week until July.
“Leverage is your enemy.”
Pal’s comments occur when Bitcoin sinks below USD $23,000, a level not seen since late 2020, and the rest of the cryptocurrencies mimic it in losses. Overall, the global cryptocurrency cryptocurrencies are digital currencies that use cryptographic technologies to secure their operation. market also plummets as its capitalization has dropped below the $1 trillion level for the first time since 2021.
The co-founder of BitMEX Arthur Hayes, that also shared an analysis on Tuesday on Twitter about the cryptomarket landscape, noted that Bitcoin is forming a base around $20,000, and noted that a drop below this level could be painful, as it could trigger massive selling pressure in the markets.
Hayes pointed to the risks that leveraged traders might not be able to hold their positions, something Pal had also warned about. “ Leverage money that a trader borrows from a brokerage, enabling them to gain far greater exposure to a position than what their capital allows. is your enemy on a volatile asset “, the investor had written, warning against the use of leverage for the cryptocurrency market.
Waves of margin calls are hitting those foolish enough to use leverage and that is forcing the markets lower, which in turn triggers even more margin calls, Pal said.
- Cryptowinter is temporary, says Polygon founder, but Dogecoin creator thinks it could last 4 years
- Peter Schiff warns that Bitcoin will plummet further and recommends not to buy in this downturn
- Raoul Pal will sell all his gold to exchange businesses that allow customers to trade cryptocurrencies for fiat money or other cryptocurrencies. it for Bitcoin and Ethereum a decentralized open-source blockchain with smart contracts functionality.
Article by Hannah Estefania Perez / DiarioBitcoin
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