What to Expect in Bitcoin Trading?
As a crypto enthusiast, you may have noticed that Bitcoin has been stuck in a trading range recently, with minimal upward or downward movement. Historically, significant growth in Bitcoin price has been closely tied to increases in the global money supply (M2), signaling times of high liquidity and investor risk appetite.
- Major growth periods linked to M2 increases
- New capital influx leading to FOMO peaks
- Current cycle deviating from historical patterns
Potential for a More Expressive Rally
Despite a slight uptick in global liquidity benefiting Bitcoin, changes in M2 have normalized this year. The US inflation data, along with reduced expectations for interest rate cuts, have had an impact on the market dynamics.
- Lack of demand surge indicators
- Reduced selling pressure from LTHs and STHs
- Market likely to stay sideways until triggers emerge
Considering factors like profitability, leverage, and coin age distribution, the market shows potential for a more significant rally within the current cycle. Bitcoin may remain in the trading range until a more favorable macroeconomic environment, possibly triggered by the first US interest rate cut in September, which could spark a new wave of demand.
Galaxy Digital’s Mike Novogratz shares a similar view, suggesting that BTC’s price will fluctuate between $55,000 and $75,000 until the Fed makes rate cuts.
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