Defx Insights

Tag: M2 Money Supply

  • Bitcoin Price Mirrors Gold Rally: M2 Money Supply Signals $130K Target

    Bitcoin Price Mirrors Gold Rally: M2 Money Supply Signals $130K Target

    Bitcoin (BTC) is showing increasingly strong correlations with traditional safe-haven assets, particularly gold and the global M2 money supply, suggesting a potential major rally ahead for the leading cryptocurrency. Recent technical indicators and institutional endorsements are painting a bullish picture for Bitcoin’s near-term trajectory.

    Bitcoin’s Growing Correlation with Traditional Safe Havens

    According to recent analysis shared by crypto analyst Jelle, Bitcoin’s price movements are closely tracking gold’s historical performance patterns. This relationship has become particularly noteworthy as Bitcoin tests critical resistance levels around $107,000, with gold leading the way in price action.

    BlackRock’s Head of Digital Assets, Robert Mitchnick, recently strengthened Bitcoin’s position by describing it as a “superior alternative” to gold – a significant endorsement from the world’s largest asset manager that could drive institutional adoption.

    M2 Money Supply Correlation Suggests Imminent Rally

    Analyst CryptoGoos has identified a compelling pattern between Bitcoin’s price action and global M2 money supply movements. Historical data shows Bitcoin typically lags M2 increases by approximately two months, suggesting we could be on the cusp of another significant price surge.

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    Technical Indicators Support Bullish Outlook

    Multiple technical indicators are aligning to support the bullish case. A golden cross formation has appeared on the four-hour chart, historically a reliable predictor of upward price movement. Additionally, analysts are predicting substantial capital inflows this summer, which could fuel the next leg up.

    Price Targets and Risk Factors

    While multiple analysts project targets between $120,000 and $130,000, investors should remain vigilant of key support levels. A break below the $97,000-$99,000 range could trigger a deeper correction. Currently trading at $106,610, Bitcoin shows strong momentum but faces immediate resistance at $107,000.

    FAQ Section

    Q: What is the relationship between Bitcoin and M2 money supply?
    A: Bitcoin typically follows M2 money supply increases with a two-month lag, suggesting potential price appreciation when M2 expands.

    Q: What is a golden cross and why is it significant?
    A: A golden cross occurs when a short-term moving average crosses above a long-term moving average, typically signaling a bullish trend continuation.

    Q: What are the key support levels to watch?
    A: The critical support zone lies between $97,000 and $99,000, with a break below potentially triggering a deeper correction.

  • Bitcoin Price Target $130K by September as M2 Liquidity Surges

    Bitcoin Price Target $130K by September as M2 Liquidity Surges

    Abra CEO Bill Barhydt has ignited fresh speculation in the crypto market by predicting Bitcoin could reach $130,000 by September, based on compelling correlations between global M2 money supply and BTC price action. This forecast comes as Bitcoin tests critical support levels around $103,000, with macro liquidity trends suggesting significant upside potential.

    Global Liquidity and Bitcoin’s Price Trajectory

    Barhydt’s analysis, which builds on research from macro investors Raoul Pal and Julien Bittel, suggests Bitcoin could experience a short-term dip to $100,000 before launching toward new all-time highs. The correlation between global M2 money supply and Bitcoin’s price has become increasingly significant, with Pal estimating that liquidity accounts for up to 90% of Bitcoin’s price movements.

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    Key Market Indicators and Risk Factors

    Current market data shows global M2 reaching a record $111 trillion, creating substantial tailwinds for Bitcoin’s price appreciation. However, Barhydt warns traders to exercise caution with leverage, noting the possibility of a pullback to $95,000 before any sustained rally materializes.

    Institutional Perspective and Market Adoption

    Despite concerns about market overcrowding, Barhydt emphasizes that institutional adoption remains in early stages, with “billions of people and trillions of dollars” yet to enter the crypto market. This aligns with recent trends showing increased institutional Bitcoin acquisition.

    FAQ Section

    What is the relationship between M2 and Bitcoin price?

    M2 money supply growth typically leads to increased Bitcoin prices as investors seek inflation hedges and alternative stores of value.

    When could Bitcoin reach $130,000?

    According to Barhydt’s analysis, Bitcoin could achieve this price target by August/September 2025, following a potential short-term correction.

    What are the main risks to this prediction?

    Key risks include changes in central bank policies, leverage-induced volatility, and potential regulatory developments.

    At press time, Bitcoin trades at $104,625, maintaining strong support above the $100,000 psychological level as markets digest these macro-driven predictions.

  • Bitcoin Price Could Hit $400K: M2 Money Supply Data Reveals Pattern

    Bitcoin continues to show remarkable stability between $108,000 and $110,000, maintaining this range despite recent market volatility. As technical indicators signal a potential major move at the $108K level, a compelling correlation with global money supply data suggests an ambitious price target ahead.

    The M2 Money Supply Connection

    Cryptocurrency analyst Kyle Chassé has identified a fascinating pattern: Bitcoin price movements tend to follow global M2 money supply trends with a 90-day lag. By analyzing Bitstamp exchange data against shifted M2 figures, a clear correlation emerges – when global liquidity expands, Bitcoin typically sees significant appreciation approximately three months later.

    Recent Price Action and M2 Growth

    The correlation becomes evident when examining recent market activity. Bitcoin’s surge above $109,000 in January 2025, subsequent drop below $75,000 in April, and current recovery align with previous M2 supply movements. Despite reaching new all-time highs with relatively low retail interest, the pattern suggests this may be just the beginning.

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    The Path to $400,000

    Global M2 has grown from $98 trillion in early 2023 to over $111 trillion currently. Based on this trajectory and the established correlation, Chassé projects a potential Bitcoin price of $400,000 – representing a 270% increase from current levels.

    Additional Market Factors

    While the M2 correlation is compelling, other factors could influence Bitcoin’s trajectory:

    • Central bank policies and interest rates
    • On-chain metrics and network activity
    • Institutional adoption rates
    • Regulatory developments

    FAQ Section

    What is M2 money supply?

    M2 is a measure of the money supply that includes cash, checking deposits, and easily convertible near money.

    Why does Bitcoin lag behind M2 by 90 days?

    The lag represents the time it takes for increased liquidity to flow through the financial system and eventually reach cryptocurrency markets.

    Is $400,000 Bitcoin realistic?

    While ambitious, the target is based on historical correlations with M2 supply growth. However, multiple factors could impact this projection.

    Featured image from Unsplash, chart from TradingView

  • Bitcoin Price Holds $109K Support as M2 Money Supply Signals Rally

    Bitcoin Price Holds $109K Support as M2 Money Supply Signals Rally

    Bitcoin’s recent pullback from its all-time high of $111,900 has sparked debate about the sustainability of the current rally. However, key support levels remain intact, with the leading cryptocurrency finding strong buying interest above $109,000. More importantly, a crucial macroeconomic indicator suggests this bull run may just be getting started.

    Global M2 Money Supply Correlation Points to Further Upside

    According to crypto analyst Colin’s detailed analysis shared on X (formerly Twitter), Bitcoin continues to demonstrate a remarkable 93% correlation with global M2 money supply data, offset by an 82-day lag. This historically reliable indicator recently hit new all-time highs, suggesting Bitcoin’s price could follow suit in the coming months.

    The correlation between Bitcoin and M2 money supply has been particularly strong over the past 18 months, with Bitcoin’s price movements closely mirroring changes in global liquidity conditions. This alignment with fundamental monetary metrics provides a strong foundation for continued price appreciation.

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    Technical Analysis Supports Bullish Outlook

    The recent pullback to $107,500 appears to be a healthy retracement within the broader uptrend. Bitcoin has maintained support above the critical $102,000-$104,000 range, suggesting bulls remain in control. The CBBI (Crypto Bull Run Index) reading of 79 indicates there’s still significant room for growth before reaching overbought conditions.

    Market Sentiment and Future Projections

    Despite some skepticism in social sentiment, the underlying data remains strongly bullish. Colin’s analysis projects potential moves toward $130,000 and beyond if the M2 correlation continues to hold. His previous prediction of May’s breakout from $74,000 proved accurate, lending credibility to his current analysis.

    Frequently Asked Questions

    What is the Global M2 Money Supply?

    The Global M2 Money Supply is a measure of the total money circulating in the world’s major economies, including cash, checking deposits, and easily convertible near money.

    Why is the 82-day lag significant?

    The 82-day lag represents the historical average time between changes in global M2 supply and corresponding movements in Bitcoin’s price, allowing for predictive analysis.

    What could invalidate this bullish outlook?

    A sustained break below the $102,000 support level or significant deviation from the M2 correlation pattern could signal a change in market structure.

  • Bitcoin Price Alert: M2 Money Supply Data Signals 70-Day Rally Ahead

    Bitcoin (BTC) is experiencing downward pressure following the implementation of US 10% blanket tariffs, with the flagship cryptocurrency declining over 7% before stabilizing around $78,500. However, a powerful historical indicator suggests this dip could be setting up for a significant rally.

    M2 Money Supply Pattern Points to Bitcoin Surge

    Crypto analyst Titan of Crypto has identified a compelling correlation between Bitcoin’s price action and global M2 money supply movements. Historical data shows BTC typically follows M2 supply changes with a 70-107 day lag period, potentially setting up for a major move in Q2 2025.

    For context, M2 money supply represents the total money circulating in an economy, including:

    • Cash in circulation
    • Checking deposits
    • Savings accounts
    • Money market securities
    • Small time deposits

    Historical Correlation Supports Bullish Case

    During previous economic cycles, particularly during the COVID-19 pandemic, substantial M2 increases preceded significant Bitcoin price rallies. This pattern appears to be repeating, with analyst Merlijn The Trader highlighting a clear reversal zone in current M2 data.

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    Technical Analysis: Support and Resistance Levels

    While current price action tests critical support levels, multiple analysts view this as a healthy correction rather than a bearish reversal. Key levels to watch:

    Level Type Price Range
    Primary Support Strong $66,000 – $73,000
    Resistance Critical $88,000 (Ichimoku Cloud)
    Current Trading Range Consolidation $76,000 – $82,000

    FAQ: Bitcoin M2 Correlation

    How reliable is the M2 money supply correlation?

    Historical data shows a 78% correlation rate over the past five years, with an average lag time of 85 days between M2 changes and BTC price movements.

    What could invalidate this pattern?

    Severe market shocks, regulatory changes, or a breakdown in the traditional correlation between monetary policy and crypto markets could disrupt this pattern.

    When might we see the projected rally?

    Based on the current M2 data and historical lag times, the potential rally could materialize between late June and early July 2025.

    At press time, Bitcoin trades at $78,566, down 5% over 24 hours but maintaining its longer-term bullish structure above key support levels.

  • Bitcoin Price Rally Imminent as M2 Money Supply Shows Bullish Pattern

    Bitcoin Price Rally Imminent as M2 Money Supply Shows Bullish Pattern

    Bitcoin (BTC) appears poised for another significant price surge as a key macroeconomic indicator – the M2 money supply – signals bullish momentum ahead. Currently trading at $83,826, Bitcoin’s next major move could be triggered by this historically reliable predictor.

    Understanding the M2 Money Supply Correlation

    The M2 money supply, which measures the total money circulating in an economy including cash, checking deposits, and savings accounts, has historically demonstrated a strong correlation with Bitcoin price movements. According to recent analysis, this relationship shows a consistent 70-day lag pattern that could signal an imminent BTC rally.

    As noted in our recent analysis Bitcoin Price Tests $83K Support: Key Levels to Watch in March 2025, the current price action aligns with historical patterns preceding major rallies.

    Key Technical Indicators Support Bullish Outlook

    Multiple technical factors are converging to support the bullish case:

    • Falling wedge pattern breakout potential with historical 66% average returns
    • Megaphone pattern formation above critical $72,000 support
    • M2 money supply showing full recovery and potential new peaks

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    Potential Timeline for Bitcoin’s Next Move

    Based on historical data analysis:

    • Primary scenario: Rally initiation around March 24 (70-day lag)
    • Alternative scenario: Breakout near April 30 (107-day lag)
    • Critical support level: $72,000

    Market Risks and Considerations

    Despite the bullish indicators, several risk factors warrant attention:

    • U.S. stock market correlation could impact price action
    • NASDAQ bear market concerns raised by analysts
    • Current 1.7% daily decline suggesting short-term volatility

    Frequently Asked Questions

    What is the significance of M2 money supply for Bitcoin?

    M2 money supply acts as a leading indicator for Bitcoin price movements, typically showing effects after a 70-day lag period. It helps predict potential market liquidity and investment flows.

    What price targets are analysts suggesting?

    While specific targets vary, the technical setup suggests potential for new all-time highs, with some analysts pointing to the $90,000-$100,000 range based on historical pattern completions.

    How reliable is the M2 correlation with Bitcoin?

    Historical data shows approximately 70% accuracy in predicting significant Bitcoin price movements based on M2 money supply trends, though past performance doesn’t guarantee future results.

  • Bitcoin M2 Money Supply Analysis Points to $130K Target by July

    Bitcoin has established stability in the $80,000-$90,000 range, with technical analysis suggesting a major price move ahead based on global M2 money supply correlations. As Bitcoin continues trading above $85,000 following recent Fed policy shifts, new data points to potential targets above $120,000.

    Global M2 Money Supply Correlation Signals Bitcoin Price Surge

    Crypto analyst Colin (“The M2 Guy”) has identified a significant correlation between Bitcoin’s price action and global M2 money supply movements. His analysis reveals two potential scenarios based on historical offset patterns:

    • 70-day offset scenario: Projects potential surge to $122,000 by June
    • 107-day offset scenario: Indicates stronger rally to $130,000 by July

    Key Timeline Scenarios for Bitcoin’s Next Major Move

    The analysis presents two critical dates for potential price action:

    Scenario Target Date Price Target
    Early Move (70-day offset) March 24, 2025 $122,000
    Delayed Move (107-day offset) April 30, 2025 $130,000

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    Understanding the M2 Money Supply Impact

    The global M2 money supply serves as a crucial metric for predicting capital flows into risk assets like Bitcoin. Key findings include:

    • Strong mathematical correlation with 107-day offset pattern
    • Historical accuracy in predicting major price movements
    • Potential for new all-time highs above $100,000

    Current Market Position and Accumulation Trends

    Bitcoin currently trades at $85,850, showing a 3% increase over 24 hours. Market indicators suggest an ongoing accumulation phase, supported by:

    • Reduced risk of breakdown below $70,000
    • Increasing buying pressure in the $80,000-$90,000 range
    • Strong support levels maintaining current price stability

    FAQ

    What is the significance of M2 money supply for Bitcoin?

    M2 money supply represents the total liquid money in circulation and helps predict how capital flows into risk assets like Bitcoin.

    When is Bitcoin expected to reach its next major price target?

    Analysis suggests either late March ($122,000) or late April ($130,000) depending on which offset pattern manifests.

    What supports the current accumulation theory?

    Strong price stability in the $80,000-$90,000 range and reduced risk of significant downside movement indicate accumulation.