Bitcoin is showing remarkable strength as it climbs above the $90,000 mark, testing key supply levels with consistent momentum. This bullish move underscores Bitcoin’s resilience and growing demand, fueled by both institutional interest and macroeconomic conditions.
Key data from CryptoQuant highlights an important factor driving Bitcoin’s recent surge: excess global liquidity. A clear correlation between the M2 money supply and BTC price action suggests that growing liquidity in global markets is acting as a catalyst for BTC’s growth.
M2, the US Federal Reserve’s estimate of the money supply, includes cash, checking deposits, and easily convertible near money, providing a comprehensive view of liquidity in the global economy.
As central banks worldwide ease monetary conditions, the influx of liquidity appears to be bolstering Bitcoin’s appeal as a hedge against inflation and a store of value. This trend aligns with historical patterns, where increased money supply often correlates with upward momentum in BTC prices.
The coming weeks are poised to be pivotal for BTC as it continues its push upward with strength. Investors and analysts are closely monitoring its ability to maintain momentum above the $90,000 level and overcome key resistance zones. Should BTC sustain its trajectory, it could ignite further bullish sentiment, paving the way for a rally to new all-time highs. However, consolidation at these levels could also present opportunities for long-term investors to enter the market.
Bitcoin Bull Run Is Only Starting
Bitcoin has entered a bullish phase, with many investors speculating that this rally is just the beginning. Over the past week, Bitcoin’s price has surged aggressively, hitting a new all-time high at $93,483. This impressive price action is not only driven by market sentiment but also by broader macroeconomic factors influencing global liquidity.
CryptoQuant analyst Axel Adler recently shared a compelling chart on X that underscores a striking correlation between BTC price action and the global M2 money supply. The chart reveals that Bitcoin tends to move aggressively when global M2 begins to rise, suggesting a strong link between monetary expansion and BTC’s upward trajectory. This aligns with historical patterns where increases in excess global liquidity often act as a tailwind for Bitcoin’s price growth.
The current rise in M2 highlights a global shift toward easing monetary policies, creating a favorable environment for BTC. With central banks increasing liquidity to stimulate economic growth, assets like Bitcoin, perceived as a hedge against inflation, gain heightened investor interest.
As global M2 growth persists, the outlook for BTC remains highly optimistic. Analysts suggest that if this trend continues, Bitcoin could be poised for even more significant gains, solidifying its position as a premier asset in the digital economy. Investors are closely watching for sustained momentum, which could further validate the long-term bullish narrative.
BTC Price Action
Bitcoin is currently trading at $91,300 after a strong 4% surge on Friday, closing above the crucial $90,000 mark. This bullish momentum signals growing strength in the market, and if Bitcoin manages to hold above this level for a few days, a push to new all-time highs would likely follow. The price action has been consistently bullish, indicating that buyer interest remains strong despite occasional fluctuations.
However, a healthy retrace to lower demand levels, such as $85,000, could provide the necessary consolidation for BTC to fuel another rally. Such a pullback would allow for more accumulation and a solid base before challenging its all-time highs.
While the overall market sentiment remains optimistic, a slight correction could be expected as BTC navigates key resistance levels. If the $85,000 mark holds as support, it would reinforce the bullish trend and position BTC for its next leg up.
The current price action suggests that the market is poised for continued growth, with new highs within reach if demand remains strong. Traders and investors will be closely watching the next few days to determine whether BTC can sustain this bullish phase and continue pushing upward.
Featured image from Dall-E, chart from TradingView