Originally published on: October 08, 2024
Despite China’s announcement of halting economic stimulus, Bitcoin and the crypto market are set to receive a fresh infusion of liquidity, according to recent analysis.
On October 8, trading firm QCP Capital predicted a “capital reallocation” towards crypto markets in a bulletin to Telegram channel subscribers.
As geopolitical tensions rose and China’s decision not to inject further stimulus measures disappointed risk assets, Bitcoin’s price action saw a decline into the October 7 daily close. BTC/USD briefly dropped below $62,000 ahead of the Wall Street open on October 8, in tandem with a decline in United States stock futures.
However, QCP Capital remains optimistic, anticipating a shift of funds back into the crypto market as the Chinese rally fades. This move reflects the industry’s increasing maturity as an alternative risk-on asset.
While short-term risks for stocks persist due to upcoming US macro data drops, QCP sees conditions improving for crypto in the near future.
Market observers share this optimism, with some predicting a strong performance from Bitcoin in October (“Uptober”) and beyond, buoyed by global liquidity trends supporting risk assets.
Despite the setback from China, traders are cautious about BTC price strength on lower timeframes, especially as the US dollar index (DXY) strengthened and US stocks faced pressure.
Popular trader Bluntz expressed concerns about potential traps in early-week crypto pumps, referencing a strong weekend performance for BTC/USD.
As the DXY saw a 1.6% increase month-to-date, reaching 102.37 at the time of writing, Bitcoin traders are advised to proceed with caution and conduct their own research before making any investment decisions.
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