- As the US dollar weakens, China appears to be strengthening its Yuan currency.
- Investor confidence is steadily growing as BTC breaks out of the micro channel.
Investors’ exposure to risks due to recession fears is decreasing as global liquidity in crypto continues to increase.
Alpha Extract on X (formerly Twitter) quoted that China is actively stimulating its economy without significantly devaluing the yuan against the US dollar.
The US plays a crucial role in liquidity, especially when it comes to the continued issuance of banknotes. A weaker dollar could therefore lead to more liquidity from other central banks.
Source: Alpha Etract
The Federal Reserve’s reserve bank credit fell by $10 billion last week, but rising collateral values caused a slight increase in the Global Liquidity Index (GLI), which now stands at $125.975 trillion, up 0.165%.
The adjusted economic rate of change (AE RoC) remained positive.
Other metrics, coupled with the trade-off between Chinese stimulus and US dollar weakness, could impact Bitcoin [BTC] prices in the longer term.
Investor Confidence Grows Significantly Bitcoin saw another big discount to Coinbase during the sell-off that occurred during last week’s market crash.
However, it quickly recovered to close with a gain of over 23% from the week’s low.
$BTC is now back at a Coinbase premium, which is generally positive as it shows positive investor sentiment from the US and ETFs.
This also means that BTC could rise due to Chinese stimulus measures and a weakening USD.
Source: CryptoQuant
Decoupling of BTC and altcoin market caps
Three years ago, Bitcoin’s market capitalization was about $835 billion, while other cryptocurrencies, excluding stablecoins, matched that.
Today, Bitcoin’s market cap is up 37% to $1.15 trillion, while other coins are down 11%.
This shift highlights Bitcoin’s dominance and questions the wisdom of those blindly diversifying into crypto.
With China’s stimulus measures and the weakening of the US dollar, Bitcoin could potentially reach new all-time highs, highlighting its strength in the market.
Source: River
Bitcoin breaks a micro downtrend
Bitcoin has broken the recent downtrend and is showing potential for a rally.
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If Bitcoin stays above $58,000, it could rise further to $61,000, which could trigger short liquidations. The next important level to watch is how it reacts at $61,000.
Coupled with Chinese stimulus measures and the weakening US dollar, Bitcoin could see a significant rally in the coming days.
Source: TradingView