Analyst Felix Jauvin believes Bitcoin is poised for a significant price increase, but not before a necessary market correction. He argues that the current downturn is a prelude to a major bullish trend.
The Current Market Situation: Degrossing and Dollar Dominance
Jauvin’s analysis hinges on the idea that Bitcoin’s price is heavily influenced by global liquidity, not just US equity performance. He points out that the US has run significantly larger fiscal deficits than other countries, leading to higher inflation and boosting US assets like the S&P 500 and, consequently, Bitcoin. This has created a situation where global capital flows primarily into the US.
The Trump Factor and Shifting Global Liquidity
Jauvin highlights the Trump administration’s aim to reduce trade deficits and encourage other countries to increase their own spending. This policy shift, he argues, will lead to less US dollar outflow, a stronger dollar for other currencies, and a redirection of global liquidity away from the US and towards other economies. As other countries increase spending, the growth in global liquidity will shift from the US to Europe and Asia. This will cause investors to reassess the risk associated with US assets.
Bitcoin’s Unique Position
Jauvin sees the current market turmoil as a necessary cleansing of overvalued US assets. He advises selling these overvalued assets to avoid further losses. However, he believes Bitcoin is uniquely positioned to benefit from this shift. Unlike other assets, Bitcoin is not subject to tariffs or national borders, making it a clean exposure to global liquidity, not just US liquidity.
The Decoupling and the Moonshot
Jauvin anticipates Bitcoin will eventually decouple from US tech stocks as non-US fiscal stimulus becomes the main driver of liquidity growth. He acknowledges that this prediction has been wrong before, but believes the current potential for a significant shift in capital flows makes this time different. He sees the current market correction as a necessary step before Bitcoin experiences a major price surge. He concludes that once the market stabilizes, Bitcoin will be exceptionally well-positioned for rapid growth.
(Note: The price of BTC mentioned at the end of the original article is omitted as requested.)/p>
