Crypto Expert Predicts Festive Bitcoin Boom Amid Macroeconomic Changes

Markus Thielen, the crypto research and strategy maestro at Matrixport, suggests that the festive season could spark a notable return in the form of a Bitcoin-fueled rally. This prediction rides on the back of an intricate web of macroeconomic shakeups that, according to Thielen, might serve as a launching pad for a robust ascent in crypto prices, dubbed as the “Santa Claus squeeze.”

Thielen’s evaluation is an offshoot of the latest market trends. Here, altcoins’ recent performance surge over Bitcoin hinted at a momentum surge, potentially leading to significant gains.

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Deriving ideas from the traditional seasonal rallies often witnessed in equity markets, Thielen colorfully describes the projected crypto surge as a “Santa Claus squeeze.” Crypto-enthusiasts note that in his recent Deribit Insights report, Thielen records that Bitcoin has consistently showcased an impressive average rally of 23% during the holiday months of November and December. The past week witnessed alternative cryptocurrencies outperforming Bitcoin, further solidifying the forecast of a prospective year-end rally.

Fueling this optimism for a potential holiday season crypto surge are key macroeconomic indicators that Thielen identified. He drew attention to three primary events signaling an interest rate apex, which could fashion a suitable environment for risk-tolerant assets like cryptocurrencies.

Firstly, Thielen highlighted the U.S. Treasury’s increasing inclination towards “slowing the pace of issuing longer-dated debt,” signaling a projected decrease in interest rates. Historically, low interest rates favor growth assets such as tech stocks and consequently, digital currencies.

Another supporting factor comes from Federal Reserve Chair Jerome Powell’s “dovish” demeanor during the post-FOMC meeting press conference. Interpretations of his statements suggest a potential pause in interest rate hikes and possible cuts by 2024, injecting an aura of positivity into the markets.

Lastly, Thielen pointed to the United States’ recent lackluster nonfarm payroll report, indicating a “weakening labor market,” subsequently reducing prospects for future aggressive rate increases.

Turning attention to Bitcoin and its peer, Ethereum, Thielen reflects on the previous cycle’s end in January 2019, when the last Fed rate hike propelled Bitcoin to rally by an astounding 400%.

While Thielen maintains a cautious stance to preempt further dramatic gains, he anticipates that Bitcoin and a selection of “higher-beta crypto assets,” may indeed witness significant growth in the trail of years ahead.

Thielen surmises that the trigger for a broader crypto rally could be the BlackRock Bitcoin ETF’s likely approval. Besides Bitcoin, he recognizes early recovery signs within the Ethereum ecosystem, indicated by increasing revenues and Ethereum successfully upholding its critical support base of $1,550.

Bitcoin’s present performance records a 1.3% gain in the last week and a modest 0.3% rise in the past day. Meanwhile, Ethereum boasts a marginally higher gain of 5% in the past week and 1% in the last 24 hours. At the time of this writing, Bitcoin is trading at $34,987, while Ethereum stands at $1,897.