Peter Schiff, Chief Economist and Global Strategist at Europar, has declared that bitcoin is in a long-term bear market following a significant recent decline. Bitcoin prices have fallen 22% over the past seven weeks and have reached levels last seen in November 2021.
Schiff characterized the downturn as a "slow bleed with no indication of panic selling," suggesting there is no clear bottom in sight. He noted that investors holding bitcoin exchange-traded funds would face an 11% loss at current prices based on average cost basis. In response, Schiff recommended investors pivot to gold instead.
Gold, however, has also faced considerable pressure. Gold futures fell below $3,900 per troy ounce on Friday, after declining amid broader market turbulence linked to technology stocks and higher-than-expected inflation figures. Some analysts have warned that gold could fall further, with $3,400 identified as a potential next resistance level.
The decline in gold has prompted financial institutions to reassess the commodity's traditional role as a hedge against volatility. HSBC stated in an October report that in today's interconnected financial markets, gold cannot be isolated from pressures affecting the wider stock market. The institution noted that leveraged positions in gold can trigger margin calls when stocks decline, forcing investors to unwind positions to raise cash.
Luke Grome, Founder and President of FFTT, characterized recent gold price action as concerning, suggesting it signals broader market instability.
