Bitcoin Set for Rally as Global Liquidity Surges, Analysts Predict

Raoul Pal, a former Goldman Sachs executive and prominent macroeconomic analyst, has suggested that Bitcoin (BTC) is on the verge of a significant rally. Pal, who has a substantial following on the social media platform X, shared his analysis with his 1.1 million followers, highlighting that Bitcoin typically follows the global liquidity cycle with a 10-week delay.

Pal presented a chart showing that global M2, which measures the total money supply worldwide, has seen a sharp increase after hitting a low point in late 2024. Based on this data, Pal predicts that Bitcoin will soon end its current correction phase and begin a new upward trend. He stated, “The waiting game is almost over…the 10-week lead is my preferred.”

While Pal is optimistic about an imminent Bitcoin rally, he noted that Julien Bittel, the head of macro research at Global Macro Investor (GMI), believes that Bitcoin lags behind the global M2 metric by 12 weeks. According to Bittel, Bitcoin is expected to reach a local bottom this week before resuming its upward movement.

Earlier this month, Pal predicted that global M2 would continue to rise, while Bitcoin and the broader crypto market would experience a "regular correction." He attributed this correction to the tightening of liquidity due to a stronger dollar and higher interest rates in the fourth quarter of 2024. Pal noted that these conditions are nearly over and that financial conditions are rapidly improving, with M2 heading back to new highs.

Pal also predicted that Bitcoin could reach a market cycle top of at least $210,000. However, he acknowledged the possibility of BTC climbing even higher, potentially reaching $412,000 or $805,000. He explained that over time, Bitcoin tends to climb within a logarithmic regression channel, a technical tool that helps traders visualize long-term price trends on a logarithmic scale. The exact peak within this channel remains uncertain as the cycle develops.

At the time of writing, Bitcoin was trading at $82,500, down 2.25% from the previous day. Pal's insights provide a bullish outlook for Bitcoin, suggesting that the cryptocurrency is poised for significant gains as global liquidity continues to rise. His analysis is based on historical trends and the relationship between Bitcoin and global M2, offering a technical perspective on the cryptocurrency's potential future performance.