The post Bitcoin price drop to $72K possible due to ‘macro liquidity’ conditions — Analyst appeared on BitcoinEthereumNews.com.

After a positive start to the week, Bitcoin price reverted to negative returns after BTC (BTC) dropped 3.5% to an intraday low of $84,120 on March 28. The price rejection occurred at the cusp of the descending trendline (black) and the upper range of the ascending channel pattern. Bitcoin 1-day chart. Source: Cointelegraph/TradingView On the daily chart, BTC is currently below the 200-day exponential moving average (EMA) again, and a potential close below the key indicator might trigger further downside.    Global liquidity expansion could help Bitcoin price Recent analysis from macroeconomic market analyst Capital Flows pointed out that Bitcoin could correct to the $72,000-$75,000 region if liquidity conditions remain unchanged.  Macro liquidity refers to the total capital available in the financial system that can easily flow into risk-on assets like equities and crypto but is influenced by factors like interest rates, US Federal Reserve policies and market conditions. According to Capital Flows, Bitcoin is exhibiting a “greater convergence” with traditional risk assets, but it remains at the periphery of the risk curve. This implies that for capital to flow back into BTC, investors’ mindset must shift from focusing on less risky assets, such as bonds, to riskier assets like BTC or low-quality banks in the Russell index. The researcher said,  “Broadly speaking right now, the macro liquidity backdrop is neutral. Rates have come down marginally, but the carry trade continues to create risk for assets.” On the contrary, other analysts have pointed out that the rise of the Global M2 money supply could potentially trigger a BTC rally. The Global Liquidity chart, which monitors M2 growth from major central banks, has historically formed a correlation with Bitcoin’s price movements. Bitcoin and Global M2 Money supply correlation. Source: X.com Colin Talks Crypto, a crypto commentator, said that the predictive correlation between M2…

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Filed under: News - @ March 29, 2025 6:10 am