Cryptheory: Crypto and Internet

cryptocurrency and internet meaning, guides, learning

Why this fund manager expects a major pullback in stocks and BTC soon

3 min read

Principal at Moran Tice Capital Management, David Tice, said right now is a dangerous time for both stock and BTC investors.

Tice sold his investment management firm, Prudent Bear Funds, in 2008, during the last major financial downturn. As such, some credit him with a knack for sensing trouble in the markets.

Now, in what makes for an uncomfortable read, Tice sounds the alarm by calling this a “dangerous market.”

Tice says meltdown is coming

Pointing to macroeconomic headwinds, Tice believes a market meltdown is unavoidable at this point. In supporting his position, Tice talks about the massive overvaluation of assets and unprecedented levels of debt.

“The market is very overpriced in terms of future earnings. We are adding debt like we’ve never seen.”

In particular, Tice raises concerns over tech stocks, especially the FAANG stocks, saying rising costs are putting pressure on companies in this sector.

“A lot of money has been thrown at Alphabet and Microsoft, Apple and Facebook, Twitter, etc.,” noted Tice. “Costs are going up in that sector.”

Although Tice began the year as a BTC bull, this soon changed after BTC hit $60,000. Since then, he’s turned bearish on the leading cryptocurrency, calling it “long in the tooth.”

Also, with increasingly negative sentiment from central banks, Tice urges cryptocurrency hodlers to exercise caution.

“However, when it got to $60,000 we felt like that was long in the tooth… Lately, there’s been a lot more uproar from central bankers, Bank for International Settlements [and] the Bank of England have made profound negative statements. I think it’s very dangerous to hold today.”

BTC is sinking, or is it?

BTC is 52% down from its local top 15 weeks ago. A lot has happened in that time, but the overall attitude has been of fear and uncertainty throughout this period.

This situation is helped by BTC closing last week at its lowest level in 2021 to date. Similarly, this led to the loss of the 50 exponential moving average.

Bitcoin weekly chart

Despite that, and Tice’s bearish notice above, some analysts hold hope that the next few weeks will mark a turnaround for BTC and the rest of the crypto markets.

At present, several indicators suggest bulls could be on the verge of making a return. This includes the return of BTC whales, who, this month, began accumulating once again.

Plus, BTC on crypto exchanges continues to fall, indicating sellers are exhausted, and the exchange supply is dwindling. All of which suggest a short squeeze is on the cards.

Bitcoin exchange flows
@Saidler on

All the same, we still find ourselves in a precarious situation. Based on March 2020’s “covid crash,” regardless of whale accumulation or decreasing exchange supply, an economic meltdown would likely crash the BTC price.

The post Why this fund manager expects a major pullback in stocks and BTC soon appeared first on CryptoSlate.


Leave a Reply

Your email address will not be published. Required fields are marked *