Originally published on: December 06, 2024
As global liquidity conditions begin to shift against cryptocurrencies and risk assets, Bitcoin faces uncertain times ahead. Jamie Coutts, chief crypto analyst at Real Vision, shared concerning news for Bitcoin bulls in a recent analysis.
Despite reaching new all-time highs, Bitcoin may experience a setback in the coming months. Coutts referenced his Bitcoin MSI macro model, indicating potential challenges on the horizon due to deteriorating liquidity conditions.
A recent sharp drop in BTC/USD led to significant volatility, wiping out millions in long and short positions. Coutts emphasized the importance of his model in predicting market movements, citing its accuracy in signaling the start and end of the last bear market in 2022.
The next few months may pose difficulties for Bitcoin, as liquidity changes typically impact the cryptocurrency market with a lag of two months. While the MSI indicator turned bearish in October, the recent presidential election win prompted a brief rally.
In addition to liquidity concerns, the strength of the US dollar also plays a role in Bitcoin’s performance. Despite reaching its highest levels in years, Coutts anticipates a potential reversal in the dollar’s strength, providing some relief for Bitcoin heading into 2025.
At the time of writing, BTC/USD hovered around $98,000, reflecting the ongoing volatility in the market. Investors should conduct thorough research and consider their risk tolerance before making any investment decisions.
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