Raoul Pal Updates Crypto Outlook Amid Signs Of Market Recession
According to Raoul Pal, an investment strategist and economic historian, the world is going through a recession period. Regardless, he believes that crypto assets are be a viable investment class in the long term.
Pal spoke with Caleb Silver from Investopedia Express podcast, and said that the Federal Reserve’s recent decision to raise interest rates will continue to damage a reeling economy.
“My macro view is that we’re in recession, it’s going to be pretty nasty.
The Fed shouldn’t have done what they did but the bond market tightened for them anyway – the Fed didn’t actually do it, the bond market did it all. The Fed are going to have to unwind this mess, but it could get messy at first.
Using all the technical indicators that I look at, my view is if we are going to reach a proper bounce or a low, it happens in June. So we’ve got between now and June for everyone to freak out.”
Talking about the crypto market amid the broader economic turmoil, Pal noted that leading smart contract platform Ethereum (ETH) has held its ground quite well in the face of inflation and the international sanctions fallout after Russia’s military operation in Ukraine back in February.
“It is like a teenager, but let’s face it – Ethereum’s down like 40% this year and the Nasdaq’s down 25%. It’s not terrible, and Ethereum for example hasn’t made a new low versus last year while we’ve thrown in inflation and rate hikes and wars and everything at it.
I don’t think we’ve gotten the massive blow-off top. We’ve got a sort of blow-off top, and I think we’re in this very wide sloppy range.”
The investment strategist remains confident of Bitcoin (BTC) and wider crypto market’s long-term potential. He believes that inflation is the reason why retail investors are not entering the space right now.
“The space is not going away. The central banks are building digital currency rails. Everybody’s building everything.
We’re in this period where retail investors couldn’t afford to dollar cost average anymore because their pocketbooks got his by negative real earnings. Their wages didn’t go up as fast as inflation, so they have to spend it at the supermarket and not crypto.”
Pal ends his crypto talk by saying that despite the wild price swings that Amazon’s early investors witnessed, in the long term the tech giant has been quite profitable.
