As 2025 begins, the crypto market is showing signs of recovery from the late December correction, setting an optimistic tone for the year ahead. Market leader bitcoin has shown remarkable resilience by holding strong support at $92,000 despite recent selling pressure. This stability has renewed investor confidence, with many eyeing a possible continuation of its upward trajectory.
Prominent analyst Axel Adler recently shared insightful data, emphasizing the importance of global liquidity trends in bitcoin's growth. According to Adler, the influx of global liquidity, albeit with a slight delay, will likely provide a significant boost to btc in the coming months. This aligns with broader expectations of increased institutional interest and the growing recognition of btc as a hedge against macroeconomic uncertainties.
Now as the broader market begins to wake up, bitcoin appears well positioned to capitalize on this renewed momentum. Analysts and investors alike are closely monitoring the price action, especially as it remains firmly above the critical support at $92,000. If this level holds, btc could be primed for a new rally, potentially reclaiming all-time highs and setting the stage for a strong 2025. For now, all eyes are on the market leader as it navigates this pivotal moment.
bitcoin growth fueled by M2
Historically, bitcoin has seen significant growth whenever the global money supply (M2) begins to increase, and this correlation has caught the attention of analysts and investors who anticipate a massive rally for btc in the near future. Analysts believe that btc is poised to benefit from the continued expansion of global liquidity.
<a target="_blank" href="https://x.com/AxelAdlerJr/status/1874757090788700451″ target=”_blank” rel=”noopener nofollow”>A Compelling Chart Shared by CryptoQuant Analyst Axel Adler x highlights this correlation, illustrating the price of btc alongside M2 Global Liquidity day after day. The chart reveals a clear connection between the two, with a notable 4-6 month lag between increases in M2 and bitcoin price growth. This pattern suggests that as central banks continue to adopt expansionary monetary policies, injecting liquidity into the global economy, btc is likely to see a substantial upward movement.
The relationship between M2 and bitcoin underscores how the cryptocurrency could act as an inflation hedge and store of value in an environment of growing global liquidity. As central banks continue to pursue accommodative policies, including low interest rates and money supply growth, bitcoin will benefit from this macroeconomic trend.
As M2 grows, the price of bitcoin historically follows suit, driven by increased liquidity entering the market. Given the current track record of central banks pushing for expansionary monetary policies, this trend points to a favorable outlook for btc in 2025. Investors and analysts alike are closely monitoring these developments, with many predicting that btc could see another major rally next. as global liquidity continues to increase. .
Price Action: Technical Levels
bitcoin is currently trading at $96,500 after confirming strong demand at the $92,000 level. This price action comes after several days of selling pressure, indicating that the bulls have regained control, at least for now. The strong rally from $92,000 has provided confidence in the market, but the critical $100,000 mark remains a key hurdle.
For a rally to materialize, the bulls must regain this psychological level. Breaking above $100,000 would indicate further bullish momentum, which could push btc to new highs. However, there is still a risk as btc remains below this key level. If btc fails to break and sustain above $100,000 in the coming weeks, the market could face further consolidation or even a pullback.
Failure to break above $100,000 could lead to a loss of momentum, which could trigger a deeper pullback. Traders and investors are closely monitoring bitcoin's ability to maintain its current strength. The next few weeks will be crucial in determining whether btc can overcome this resistance or if it will face further challenges in price action.
Featured image of Dall-E, TradingView chart
