.jpg)
Henrik Zeberg, chief macroeconomist at SwissBlock, has reiterated his prediction that a recession in the United States is inevitable, but not before a significant rally in financial markets, including a significant rise in the price of Bitcoin to levels between $115,000 and $120,000. analysis In an article published on X, Zeberg discussed the cyclical nature of markets and how they align with historical economic indicators and current fiscal policies.
“Remember!? In December 2022, everyone was pessimistic! I was optimistic! We were told that an “imminent crash” was waiting for us – despite the fact that the market bottomed out in October 2022,” Zeberg reiterated in his post. He laid out his precise predictions for major market indices and Bitcoin, pointing to the “coming crash.”
Bitcoin faces its first recession ever
The term “sudden top” refers to a sharp and rapid rise in prices in financial markets, followed by an equally sharp decline. This pattern is characterized by intense buying pressure that pushes prices to very high levels, often driven by speculative or euphoric behavior among traders. This price rise is usually unsustainable, leading to large sell-offs as traders take profits or react to overbought conditions.
Related reading
The top hit that Zeberg predicted could be caused by the US Federal Reserve pumping in. Huge amounts of liquidity On this basis, Zeberg expects the S&P 500 to rise to $6,100-6,300, the Nasdaq to $24,000-25,000, the Dow Jones Industrial Average to around $45,000, and Bitcoin to $115,000-120,000.
Zeberg’s upbeat stance stands in stark contrast to his dire predictions for the post-upturn period. “Now… we’re not at the top – yet! But the recession is coming – and it will be the worst since 1929. A major bear market (in two phases; deflationary and stagflationary – separated by a midway recovery with the Fed in 2025),” he explained, referring to a complex recessionary cycle influenced by market dynamics and Fed policy.
Economists doubt effectiveness of impending economic reforms Fed Rate Cuts This approach is based on a detailed critique of similar historical measures. Although the market expects a 25 basis point rate cut at the next FOMC meeting in September—a move supported by 73.5% of market participants (according to the CME FedWatch tool), with a smaller percentage (26.5%) expecting a more aggressive 50 basis point cut—Seberg remains unconvinced that this will prevent recessionary pressures.
Related reading
“But… but… the Fed’s rate cuts… The global economy is collapsing. The US recession starts in December 2024,” Zeberg said, reflecting his belief that short-term liquidity injections are insufficient to combat deeper economic malaise. Pointing to liquidity cycle metrics comparable to those seen in 2007, he questioned the effectiveness of such strategies in preventing the 2008 financial crisis.
Furthermore, Zeberg highlights the final ending of coup Among the United States, 2-year and 10-year Treasury yields are traditionally seen as indicators of an economic slowdown. The inversion, where short-term yields exceed long-term yields, is usually a sign that investors are uncertain about the near-term economic outlook.
A key pillar of Zeberg’s argument is recent labor market data. The U.S. Bureau of Labor Statistics revised its March 2024 total employment estimate down by 818,000 jobs — the largest revision in 15 years — suggesting a deeper labor market weakness than initially estimated. “The economy is much weaker than expected,” Zeberg said.
At the time of publishing this report, Bitcoin was trading at $60,764.
Featured image created using DALL.E, chart from TradingView.com
