Two Prime Report Highlights a Resilient Correlation Between the Global Liquidity BTC Price Rise

The platform mentioned that the worldwide trends concerning liquidity can significantly impact the price movements of Bitcoin.

A recent report by Two Prime Digital Assets, a crypto intelligence firm, sheds light on how global liquidity trends influence the price of Bitcoin. According to the platform, there is a significant correlation between M2 growth and the price surges of the premier crypto token.

The company shared insights from its exclusive report in a series of posts on its social media handle. At the time of writing, the premier crypto is trading at a price of $67,000.

Two Prime Report Highlights A Strong Correlation Between Global Liquidity BTC Price Rise

The platform noted that the global trends pertaining to liquidity can largely impact the price movements of Bitcoin. Notably, it discussed this in the context of the 2nd half of 2024. The report highlights a strong correlation between the price of Bitcoin and global liquidity. It went on to add that the key drivers in this regard include the bond markets and policy actions in China and the United States.

In Q2 of the current year, a minor pullback was observed in global liquidity. The main factor contributing to this pullback was the continuous tightening by the United States Federal Reserve. Furthermore, another factor was the economic struggles within the Chinese jurisdiction to stabilize the nation’s economy. Despite this, the outlook for the 2nd half suggests a more optimistic scenario.

The Report Suggests An Optimistic Scenario, Expecting Global Liquidity To Continue Rising At Slower Rates

It leads to expectations about the return of global liquidity to a largely bullish trajectory. However, this is likely to occur at a slower pace than some might anticipate. The analysts use certain indicators to gauge the liquidity in the BTC market. They consider trends pertaining to corporate treasuries, public equities, ETFs, and stablecoins.

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These indicators collectively point towards an optimistic scenario for the premier crypto asset in H2. However, market participants should continuously observe the market to validate these trends. According to the analysis, the phases of M2 money supply growth closely correspond with the price surges of Bitcoin. Conversely, the decline in M2 corresponds with the downward price action. M2 serves as an indicator of potential decreases or increases in inflation levels.

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