In the intricate landscape of cryptocurrency, one chart emerges as a beacon of hope for Bitcoin and its contemporaries. With the resurgence of the US money supply, investors find themselves at a crucial juncture. As the printing presses churn out fiat currency at an accelerated pace, the specter of dollar devaluation looms ominously.
Analyzing the Impact of US Money Supply on Bitcoin’s Price
The resurgence in the US M2 Money Supply presents a bullish outlook for Bitcoin. A rising M2 Money Supply traditionally correlates with a weaker US Dollar, which subsequently incentivizes greater diversification into Bitcoin, ultimately driving its price higher. Examining data from the Federal Reserve Board of Governors reveals a noteworthy trend.
The peak of the M2 money supply reached $21.722 Billion in April 2022, gradually tapering to $20.841 Billion by March 2024. Although this decline may seem modest, amounting to $881 billion or 4.06% over approximately two years, it marks the first such decline of at least 2% since the Great Depression.
Considering Bitcoin’s reaction to previous increases in the M2 money supply, historical data suggests a bullish outlook for the cryptocurrency. The correlation between M2 expansion and Bitcoin’s bull market reinforces the narrative that Bitcoin may be poised for another significant uptrend.
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Bitcoin’s Price Trends and Market Analysis
Bitcoin’s price movements indicate a period of consolidation within a broad descending channel. Recent market activity has seen the price being tested against the $60,000 level once again. A breach of this level could potentially lead to the breakdown of the descending channel, triggering a substantial decline towards the $52,000 support zone. The open interest of Bitcoin is at +0.58% in the past 24 hours currently valued at $16.3 Billion.
The Relative Strength Index (RSI) however shows a bullish sentiment, with values above 50% signaling momentum in favor of buyers. With $60,000 broken, the market would experience further upside pressure. As Bitcoin struggles to sustain its upward trajectory and achieve new highs, bears have seized the opportunity to drive prices lower but clearly not for so long. The current market sentiment suggests a cautious approach, with investors closely monitoring key support and resistance levels for potential trading opportunities.
Bitcoin (BTC) Price Update
Bitcoin’s current price stands at $61,242.09, with a 24-hour trading volume of $21.1 billion. Over the past 24 hours, the cryptocurrency has experienced a surge of o.88%. Bitcoin is currently trading within a range of $61,081.39 and $60,565.44, with a market capitalization of $1.1 trillion.
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