As Bitcoin (BTC) continues to trade within the low $80,000 range, a key macroeconomic development guarantees to learn the leading cryptocurrency. If historical patterns hold true, then BTC might not be too removed from one other massive price rally.
Rise In M2 Money Supply To Profit Bitcoin?
In keeping with an X post by crypto analyst Master of Crypto, a rebound in global M2 money supply holds the potential to reignite BTC’s bullish momentum. The analyst explained that M2 – a number one indicator – often predicts significant shifts in Bitcoin’s price trajectory.
For the uninitiated, M2 money supply is a measure of the overall money circulating in an economy, including money, checking deposits, savings accounts, and other liquid assets. It’s a key indicator of liquidity, influencing inflation, economic growth, and financial markets, including emerging assets like Bitcoin.
Master of Crypto noted that historically, M2 movements are inclined to predict BTC’s price momentum with a 70-day lag. The analyst added:
Recently, as M2 began to rebound before BTC, it’s now fully recovered and poised to hit latest peaks suggesting BTC might do the identical. Analysts have insights on why this upcoming BTC rally could surpass all previous ones.
Fellow analyst James echoed these views, highlighting that BTC may experience one other price rally after a transient period of dip and consolidation.
Crypto analyst The M2 Guy provided further insight, suggesting that if the 70-day lag holds, BTC’s next rally could start around March 24. He added that an alternate scenario – based on a 107-day lag – points to April 30 because the potential breakout date.
Technicals Point Toward BTC Take-Off
Crypto trader Merlijn The Trader identified a possible breakout from a falling wedge pattern – a historically bullish formation for Bitcoin. On average, BTC has delivered 66% returns following a breakout from this pattern on the three-day chart. An analogous move now could propel BTC to latest all-time highs (ATH).
Furthermore, Merlijn noted that BTC can be tracking a megaphone pattern. Nonetheless, he cautioned that Bitcoin must hold above $72,000 for this bullish structure to stay intact.
Crypto expert Burak Kesmeci pointed out that a recovery within the U.S. stock market could also be crucial for Bitcoin’s next surge. He emphasized the strong correlation between cryptocurrencies and traditional equities, suggesting BTC could struggle if stocks remain weak.
Meanwhile, well-known American gold advocate Peter Schiff issued a bearish warning. He argued that BTC isn’t out of the woods yet – predicting a possible “catastrophic drop” if the NASDAQ enters a bear market. At press time, BTC trades at $83,826, down 1.7% previously 24 hours.
Featured Image from Unsplash.com, charts from X and TradingView.com
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