The post Bitcoin – How global liquidity will affect BTC’s bull market trend appeared on BitcoinEthereumNews.com.

Decreasing demand for U.S. Treasury Securities may signal a capital shift toward riskier assets, including Bitcoin. Currently, Bitcoin’s Social Volume is trending upward, though it remains below levels seen during the 2021 bull market. Global liquidity has consistently influenced asset prices, including Bitcoin’s [BTC]. Through analysis liquidity inflows, represented by M2 (a measure of money supply), align with Bitcoin’s growth, though with a slight delay. On the other hand, while the U.S. Federal Reserve continues its Quantitative Tightening (QT) policy, the declining demand for U.S. Treasury securities (UST) may signal a capital shift toward riskier assets, including Bitcoin. CryptoQuant This potential shift, coupled with broader global liquidity dynamics, could support Bitcoin’s bull market even in the absence of direct Quantitative Easing (QE). Bitcoin’s price movement and Global M2 Liquidity Bitcoin’s price correlates with the Global M2 Day-over-Day (DoD) 30DMA. The most notable instance occurred after the COVID-19 liquidity injection when Bitcoin’s price surged to its all-time high following a rapid M2 increase. More recently, despite the Federal Reserve’s QT stance, global liquidity has shown a slight uptrend, supporting Bitcoin’s current price recovery. This recovery aligns with the historical trend of delayed responses to M2 inflows. A bell curve-shaped growth pattern in M2 aligns with Bitcoin’s long-term bullish movements, highlighting how liquidity positively impacts Bitcoin’s price. If the Federal Reserve intervenes due to a potential crisis in T-bills, M2 could rise sharply. Such intervention would likely propel Bitcoin prices upward again. With the current M2 uptick, Bitcoin may retest its previous highs if liquidity sustains, indicating a possible bullish breakout in 2024. Market sentiment and Bitcoin’s potential growth The Greed & Fear Index reflects market sentiment, significantly influencing Bitcoin’s price movement. Historically, Bitcoin tends to rally when the index shifts from extreme fear to neutral or greed levels. Currently, this metric…

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Filed under: News - @ January 4, 2025 6:17 am