- The People’s Bank of China injected $65 billion into overall global liquidity.
- As a result, Bitcoin showed bullish sentiment.
As a seasoned analyst with over two decades of experience in financial markets, I’ve seen my fair share of economic cycles and market fluctuations. The recent move by the People’s Bank of China to inject $65 billion into global liquidity is not just another data point for me – it’s a potential catalyst for significant price movements in Bitcoin.
The Chinese central bank, the People’s Bank of China (PBoC), has stepped up its supportive measures, pumping in more than $65 billion into the economy, according to Tomas’ recent observations on platform X (previously known as Twitter).
In simpler terms, recent data from July indicates a decrease in Chinese bank loans for the first time in 19 years, which could suggest economic difficulties.
As a crypto investor, I’ve been keeping an eye on recent developments, and it appears that the Chinese Communist Party has announced new policy measures. Additionally, it’s anticipated that the People’s Bank of China (PBoC) will carry on its liquidity injections according to their usual 12-month cycle.
Over the past few weeks, this situation has resulted in the Yuan becoming stronger compared to the US Dollar. This could provide the People’s Bank of China with additional leeway to introduce further monetary easing measures.
More central banks are increasing liquidity, signaling a potential Bitcoin [BTC] surge.
Over the past month, collectively, the Bank of Japan and the People’s Bank of China have added approximately $400 billion and $97 billion to their respective monetary supplies, resulting in a global increase of around $1.2 trillion.
According to the Global Momentum Shift Indicator (MSI), it has given its initial positive signal regarding Bitcoin [BTC] since November 2023 – a period that preceded an increase of approximately 75% in Bitcoin’s price, followed by a downturn.
It seems this growth is probably synchronized with the Federal Reserve, bolstered by a depreciating U.S. currency.
If the U.S. Dollar keeps depreciating, Bitcoin might experience a significant surge of about 2-3 times its current value. This potential increase is primarily due to global M2 money supply exceeding $120 trillion, a phenomenon that has triggered an upward trend in Open Interest, suggesting increased investment in Bitcoin.
Of Open Interest & ETF
Despite some recent modest declines in Bitcoin’s price, its open interest has persisted at a consistent high, primarily fueled by increased trading on the OKX and Binance platforms.
The consistent rise indicates a persistent high interest or demand for Bitcoin [BTC] holdings, as escalating market fluidity leads to more purchases being made.
Based on my extensive experience in the financial market and observing the dynamics of Bitcoin over the years, I believe that its price is poised for a steady upward trend in the long term. This conviction stems from the consistent buying pressure I’ve noticed, which suggests strong investor interest and confidence in the cryptocurrency. As someone who closely follows market trends, I find it encouraging to see Bitcoin maintaining its momentum despite occasional fluctuations and market uncertainties. While there may be short-term volatility, my personal view is that this trend signals a promising future for Bitcoin’s price growth.
An increase in Open Interest and worldwide availability of funds might lead to a surge in Bitcoin ETF investments, even if the price of Bitcoin itself is decreasing.
As a crypto investor, I’m seeing that institutions are seizing the moment to buy the dip. This could be a sign of an upcoming long-term price surge. Given the potential for global liquidity to drive Bitcoin’s value even higher, it might be wise to consider making a purchase now.
Bitcoin liquidation levels
At the moment, Bitcoin (BTC) is hovering near significant points of $60,000 and $62,000. If it sustains this position, it might lead to a rush to buy (liquidity grab) or a forced buying due to short positions being closed out (short squeeze).
If Bitcoin surpasses the $62,000 mark, it could propel the cryptocurrency to reach around $74,000 and possibly set a fresh record high by the end of Q4 2024, driven primarily by growing worldwide liquidity.
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2024-08-16 15:49