Bitcoin Poised for Breakout as Global M2 Money Supply Surpasses $100 Trillion

Bitcoin is on the verge of reaching an all-time high, with the global M2 money supply surpassing $100 trillion. This significant increase in liquidity has historically correlated with substantial price movements in Bitcoin, often leading to bullish phases for the cryptocurrency. The current environment, marked by steady M2 growth, suggests that Bitcoin is poised for a substantial upward trajectory once momentum returns.

Historical data shows a recurring pattern where Bitcoin's price movements lag behind the expansion of global liquidity before initiating major rallies. In previous cycles, Bitcoin consolidated during initial M2 surges, only to follow with sharp upward moves. The current divergence, with Bitcoin consolidating around $110,000 while M2 continues its ascent, mirrors these past scenarios. This pattern underscores Bitcoin’s sensitivity to macroeconomic liquidity conditions and its role as a digital asset responding to global monetary flows.

Central banks’ policies of debt monetization and stimulus injections have fueled the expansion of M2, increasing the amount of money circulating in global markets. This liquidity influx typically supports asset prices, including equities and cryptocurrencies. Bitcoin, with its fixed supply and decentralized nature, often benefits from such conditions as investors seek alternative stores of value. The current macroeconomic backdrop, characterized by abundant liquidity, aligns with historical periods where Bitcoin experienced substantial gains following similar monetary expansions.

Analysts emphasize the significance of the current liquidity environment, noting that Bitcoin’s price could soon align with the rising M2 trajectory. Their analysis suggests that if historical correlations hold, Bitcoin may target a price range between $130,000 and $170,000 in the near term. This projection is based on previous cycles where Bitcoin’s delayed response to liquidity growth culminated in rapid price appreciation, reinforcing the cryptocurrency’s role as a liquidity-sensitive asset.

On July 2, Bitcoin increased by 2.37% to reach a price of $108,434 because traders were reacting to the rising global liquidity. Cryptocurrency is currently below its highest price by a bare 3.13%, sparking a revival in interest in the markets. The increase in the price of Bitcoin has also been accompanied by a record increase in the global M2 money supply that has recently exceeded the figure of two hundred trillion dollars. In the past, the more the money supply has increased, the demand for Bitcoin has gone higher, as investors aim at hedging against the devaluation of currency.

According to market analysts, the hoarding of BTC started in February. This piling-up phase is normally preceded by a breakout, as witnessed in the past market cycles. A big breakout is now the scene that traders are keenly monitoring since the forceful attempts to purchase continue. Known crypto analyst Ash Crypto observed that BTC prices and money supply patterns have a connection, and it may increase to reach 175,000. MartyParty, another analyst, predicts that Bitcoin is going to trade in the neighborhood of 145,000 to 146,800. They have an outlook that is related to the effects on the liquidity across the market.

Bitcoin might also gain momentum because of the recent all-time high in the S&P 500 index. Analysts also predict that a good equity market will also flow into crypto markets, which will also contribute to the optimistic sentiment of Bitcoin. With the rise of the money supply, there have been increases in apprehensions concerning inflation. It is therefore leading investors to seek a haven in Bitcoin. Analysts say that the Bitcoin price has moved alongside the M2 supply, and this presents a good reason to expect the indicator to move upwards in the future.

The BTC chart is in a bullish flag pattern, and it means additional upward movement. In case the price cracks the existing resistance, it can rise up to $119,000, which is the projected value. This would be the new ATH, which would be supported by the market structure and the great support of both the 50-day and 200-day moving average lines. As global M2 money supply reaches new all-time highs, Bitcoin’s historical pattern of following liquidity trends positions it for a potential breakout. The current consolidation phase may serve as a foundation for significant gains, supported by expansive monetary policies and growing global liquidity. Investors should monitor these macroeconomic indicators closely, as they provide valuable insights into Bitcoin’s future price movements and broader market dynamics.