Bitcoin (BTC) is currently hovering around $80,000, but some analysts believe a major price surge is on the horizon. This prediction is based on several factors, including a key macroeconomic indicator and technical analysis.
The M2 Money Supply: A Key Indicator?
One prominent indicator is the M2 money supply – the total amount of money circulating in the economy. Crypto analyst Master of Crypto points out that historically, changes in the M2 money supply have predicted significant shifts in Bitcoin’s price, usually with a 70-day lag. With the M2 supply rebounding, Master of Crypto suggests Bitcoin could be poised for a similar upswing.
Other analysts share this view. James believes a rally is likely after a short period of consolidation. The M2 Guy offers specific dates: March 24th (based on the 70-day lag) or April 30th (based on a 107-day lag) as potential breakout points.
Technical Analysis Suggests a Breakout
Technical analysis also paints a bullish picture. Trader Merlijn The Trader observes a “falling wedge” pattern on Bitcoin’s chart – a historically bullish formation that has, on average, resulted in a 66% return. A similar breakout could push Bitcoin to new all-time highs. However, he cautions that Bitcoin needs to stay above $72,000 for this positive trend to continue. Another pattern, a megaphone pattern, is also being tracked.
External Factors: Stocks and Gold
While the technical and macroeconomic indicators are positive, other factors could influence Bitcoin’s price. Analyst Burak Kesmeci highlights the correlation between Bitcoin and the US stock market, suggesting that a strong stock market is crucial for Bitcoin’s next rally.
Conversely, Peter Schiff, a well-known gold advocate, offers a bearish outlook, warning of a potential “catastrophic drop” if the NASDAQ enters a bear market.
The Bottom Line
Currently, Bitcoin is trading at around $83,826, slightly down for the day. While several analysts predict a significant price rally based on both macroeconomic indicators and technical analysis, external factors like the performance of the stock market could play a significant role in determining Bitcoin’s future price.
