Raoul Pal, the founder and CEO of Real Vision and Global Macro Investor, believes the crypto market has “found its bottom” and that new upside momentum is likely.
The comments were made by the Real Vision CEO during an interviewLayah Heilpurn: His outlook comes at a time when Bitcoin and the rest crypto are looking to bounce back after a few days of declines.
Bitcoin has recovered some of its losses from the lows at $39,000 this week and now hovers around $41,200. BTC/USD has risen 4% over the past 24 hours and crypto market capitalisation has rebounded 3%.
Cardano (ADA), Ethereum (ETH), BNB (BNB), XRP (XRP), and Solana have all increased more than 3% over the past 24 hours. Some of the largest crypto gainers today are Bitcoin Cash (BCH), Litecoin(LTC) and Avalanche [AVAX].
Crypto didn’t make a new low
Pal claims that the crypto market has been affected by macro developments in recent months. Despite many possible negative triggers and no new low, however, it has not fallen since the 2021 bottom.
It’s a scenario that suggests crypto resilience and that that could point to a low already being in, although no one can with certainty predict the market.
“The balance of probabilities is that we made the low last year, we retested the low this year and I think the low is in,” he noted.
He believes crypto’s seen “everything” that could have helped push prices to a new low. That hasn’t happened so far. Heilpurn was told by he:
“I think we’ve thrown a war, 8.5% inflation, the Fed raising interest rates all at crypto, we’ve thrown the Chinese ban, we’ve thrown so much at it and [yet it]didn’t make a new low. Usually, that’s usually a signal the market has found its bottom.”
A slowing economy could prompt fresh upward action
Pal believes that a slowdown of economic growth is the best catalyst for crypto price movements. This is a scenario that will trigger buying pressure in assets that “tend to outperform in low growth environments.”
He says that a change in the economic landscape could see “people fear inflation less and start fearing growth more.”According to Pal, this is when long-duration assets (and crypto is one such asset that loves a slowing economy) begin to outperform.
In the stock market, Cathie Wood’s ARKK is a good example.
Pal also talked about Bitcoin’s four-year cycle narrative, noting that these are likely over given the market’s size today compared to during the early years. He said that the cycle could still have an impact but it could be on a smaller scale due to further adoption reducing wild volatility.