Bitcoin is a fresh eye as China joins the Fed in epidemic-level stimulus.
Key receivers
China's $140 billion stimulus could push Bitcoin above $70,000. Bitcoin's technical breakout suggests it may be headed for new all-time highs.
Share this article
Bitcoin looks set for a rally following China's recent announcement of a pandemic-level stimulus package. This growth, along with recent interest rate cuts by the US Federal Reserve, has contributed to a macro environment that could push Bitcoin to new all-time highs.
China's latest liquid injection
This week, the People's Bank of China (PBOC) announced plans to cut the reserve requirement ratio by 50 basis points to inject around $140 billion into the economy.
Following previous stimulus efforts, bitcoin's price has risen more than 100%, and some analysts suggest that the latest injection of liquidity could have a similar effect.
An increase in the M2 money supply and global liquidity index supports the possibility of an upward move in the price of Bitcoin, as these factors are supported by historical asset price gains.
Technical indicators show the possibility of profit
From a technical perspective, Bitcoin has broken out of a falling wedge pattern, which is often signaled as a bullish reversal. This breakdown created momentum, pushing the price to a key resistance level of $64,500. Analysts suggest that if Bitcoin breaks this level and establishes support, it could pave the way for a move to new highs.
New #Bitcoin ATHs are imminent if we break the red line! pic.twitter.com/kHRdBSrgWz
— Crypto Rover (@rovercrc) September 26, 2024
Additionally, the Relative Strength Index (RSI), has shown upward movement after a period of decline, indicating renewed strength in Bitcoin's price. Some forecasts suggest that this could lead to a price increase to $85,000 by the end of the year, depending on continued favorable market conditions.
#Bitcoin $85,000: Medium Target 🎯
The weekly RSI breakout shows explosive activity for #BTC at the end of the year. 🚀 pic.twitter.com/M7slgFSCop
— Titan of Crypto (@Washigorira) September 21, 2024
Global stimulus and Bitcoin market performance
Historically, increased liquidity has supported Bitcoin's performance, especially during periods of low interest rates and inflation. However, concerns still remain.
While China's measures are aimed at supporting its economy, which is facing high unemployment and inflationary pressures, some analysts warn that the measures could lead to further inflation. Additionally, China's real estate sector remains under pressure, exemplified by Evergrande's recent bankruptcy filing.
Share this article
