It appears that a rally of up to 16% might be in store for the price of Bitcoin (BTC). The prediction comes from a similar one which shows that the U.S. stock market may be headed for a short-term rally as well.
Bitcoin (BTC) Price to Rally By Over 16%?
According to Morgan Stanley’s CIO Michael J. Wilson, trends in the S&P 500 index are signalling a rally of over 15% might be imminent. Per a Bloomberg report, S&P 500 is already testing the 200-weekly moving average (WMA). This follows after the S&P 500 has dipped by over 25% so far in 2022.
But seeing as the crypto market usually moves in correlation with the U.S. stock market, it might be safe to expect a similar rally in BTC price. Michael Wilson, however, insists that the rally will only come if there is no “earnings capitulation” or an “official recession.”
All Eyes on the Next Fed Rate Decision
Meanwhile, traders and the general crypto market are keeping eagle eyes on the next Fed FOMC meeting. The meeting which is slated to take place on 2nd November will undoubtedly determine the direction of the market for the next few months.
Although many continue to see recession as an unavoidable possibility, the Fed would beg to differ. And going by the probability scale of the CME FedWatch Tool, chances that the Fed will hike rates by 75 bps are now over 95%.
Interestingly, there are those — including Morgan Stanley’s Michael Wilson, who believes that inflation has now peaked. Recall that the core CPI recently hit a 40-year high. If they are right about inflation peaking, then the Fed may even opt for a 50 bps rate hike.
Meanwhile, the predictions of Michael Wilson about BTC price may come off to some as an overreach. Especially considering that the asset has failed to cross the 200-WMA since spending a short stint on the upside back in August.
For what it’s worth though, Michael Wilson rightly predicted the downturn of 2022. He is also maintaining an overall bearish position on the stock market. But for now, he believes that BTC price is strongly poised for a 16% rally from its current levels.
At press time, the BTC price was seen trading at $19,582 and up over 2.3% in the last 24 hours.