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Mike McGlone of Bloomberg highlights Bitcoin as a potential guide for stock market trends, with gold dominating 2024. Analysts weigh pivotal thresholds shaping gold, Bitcoin, and the S&P 500 index.
Bitcoin May Signal S&P 500’s Peak Against Gold
According to Bloomberg's top analyst Mike McGlone, the market capitalization of the most popular cryptocurrency, Bitcoin, may signal that the S&P 500 index is about to reach its peak relative to gold.
At 2.3 ounces per S&P 500 index on December 31st, the top expert has pointed out that the metal is below its 2018 peak of 2.4x SPX/gold, U.Today shares
Gold Gains Momentum as Resistance Looms
2.4x could be a very high resistance threshold, according to McGlone.
Compared to the flagship S&P 500 index, gold's price increased by about 29% in 2024.
Bitcoin and Gold Compete for Dominance
According to the expert, if Bitcoin reaches its peak in 2025, gold would most likely be the dominant currency.
"The rock beating stocks in a record-setting year for risk assets -- notably cryptos -- could augur wealth-effect limits favoring the store of value," he added in a previous interview.
A large number of experts last year forecasted that Bitcoin will one day be able to supplant gold. Bernstein recently predicted that Bitcoin might supplant gold within the next decade.
Shifting Investor Preferences in 2024
Per McGlone's recent interview with Kitco, Bitcoin's fortunes will only improve in 2024.
Additionally, he emphasized that gold posed a formidable challenge to Bitcoin. "You can't really hold gold anymore without some Bitcoin in that space. Anybody under 30 doesn't buy gold. They don't really care," he added.
However, he did mention that the link between Bitcoin and the US stock market is quite high, and that the stock market is now at its highest level ever in proportion to the US GDP.
Declined to $80,000 in November, Bitcoin surged to $100,000 in December. Nevertheless, this uprising ultimately failed.
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