Shares of major banks tumbled after Federal Reserve Chairman Jarome Powell’s speech, despite the president’s bullish approach and reassurances about markets. Michael Van de Poppe, the founder of EightGlobal, believes that such scenarios could play a role in a banking crisis that would kick off the next Bitcoin bull market.
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In an analysis of video uploaded to YouTube, Poppe noted that Powell, in his recent speech, argued that the banking system is strong and resilient. As a result of Powell’s speech, shares of several banks fell in value, suggesting a disagreement with the Fed chair’s position.
Banking crisis will fuel BTC bull market, according to Van de Poppe
Poppe noted that shares in some regional banks collapsed hours after Powell’s speech. PacWest Bancorp lost 57.79% of its value to top the loss chart, while Western Alliance followed with a loss of 28.61%. Other banks that led the list of losers include Comerica, which lost 10.06%, Zion’s Bancorp, which lost 9.71%, and KeyCorp, which lost 6.93%.
Using Bitcoin’s 30-minute chart, Poppe explained that while bank stocks fell after Powell’s speech, Bitcoin’s price rallied. He also noted that, like Bitcoin, gold rallied after the Federal Reserve Chairman concluded his speech and that Bitcoin moving along with gold is a good development for the crypto market.
Poppe’s analysis showed that bank stocks and Bitcoin markets are not moving in the same direction. He pointed out that the growing uncertainty among banks and the increasing tendency of those banks not to trust the guarantees of the regulator could spell more disaster for the main markets. According to him, the current scenario is not looking good for the US banking sector, and the absence of an immediate solution could have more serious consequences.
Focusing on market projections, Poppe noted that the Federal Reserve’s proposed rate cuts in the coming months could lead to a significant bull run for Bitcoin. However, if the cuts take place after the markets have started to fall, there could be a sell off of Bitcoin in a liquidity correction that could bottom out before prices start to soar again.
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