Markus Thielen, head of research at 10X Research, foresees a substantial price correction looming for risk assets like cryptocurrencies and stocks in the upcoming weeks. In an investor note shared on April 16, Thielen expressed concerns about the cryptocurrency market approaching a critical tipping point, potentially leading to a noteworthy correction in prices. He disclosed that his firm has divested all tech stocks in anticipation of this bearish event.
Thielen emphasized, “We sold everything last night,” attributing his decision to factors such as diminishing rate cuts, escalating bond yields, and persistent inflation, which contribute to his bearish outlook.
The analysis follows Bitcoin’s recent 11% decline over the past week, with a 6.7% drop observed in the last 24 hours, bringing its price to $61,988.93 at the time of publication. Thielen attributed Bitcoin’s downturn to diminishing expectations of a U.S. interest rate cut, a narrative that had been driving much of the rally in 2023 and 2024.
According to CME’s FedWatch tool, 97.5% of market participants expect interest rates to remain unchanged, echoing sentiments expressed by Mary Daly, president of the San Francisco Federal Reserve Bank, who stated that there is “no urgency” for rate cuts.
While Thielen revealed that his firm still holds some “high-conviction crypto coins,” he clarified that their overall sentiment remains bearish.
Thielen’s warning aligns with his previous bearish scenario for Bitcoin, where he speculated that cryptocurrency miners might offload $5 billion worth of Bitcoin in the months following the halving. Citing historical data, Thielen suggested that the crypto market could experience an extended period of a “summer” lull./
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