David Kelly, JPMorgan’s chief global strategist, has suggested that crypto investors should sell off their holdings due to concerns surrounding the direction of the market. This is coming after the US Federal Reserve firmed up its ante against inflation and dismissed discussions about any softening of monetary policy.

Kelly said in an interview on Friday after Fed Chair Jerome Powell’s speech at Jackson Hole, Wyoming, that the best way to be positioned now is to remain focused on valuations and avoid looking at short-term direction.

The crypto market has suffered major declines since the start of the year on fears of tighter monetary policies seeking to stamp out inflation which hit the highest level in forty years. As a result of this, the economy is now slowly being dragged into recession.

Powell stressed in his latest speech that interest rates may have to stay up to help curtail inflation, Bitcoin for a brief moment plunged below $20,000 for the first time since mid-July, as risk appetite faltered.

Kelly believes investors should steer clear of large-cap tech stocks, Bitcoin, and crypto in general at least for now. He expects more volatility to seep into the market and also a high risk of a recession is also on the cards.

Having said that, the strategist thinks the economy will be more stable by the end of next year. Kelly also added that the “Federal Reserve feels guilty over the fact that inflation went up under their watch and is overestimating the strength of the US economy.

A lot of experts think that risky assets will continue to struggle as Powell tries to tackle inflation with a restrictive monetary course. Senior market analyst at Oanda, Edward Moya said in a recent email, that this aggressive approach may trigger an economic slowdown.

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