In the past 24 hours, Bitcoin plummeted 10%, directly wiping out all gains from the U.S. crypto market.
📌 Retail panic selling has driven market sentiment to an all-time low.
📌 However, the market may be stronger than it appears!
🔍 Is now a good time to buy at a low? Here are my market views
📈 M2 money supply is about to boost Bitcoin
Why might M2 become Bitcoin's savior?
📌 Extremely sensitive to global liquidity, is one of the most sensitive assets to changes in money supply in the market.
📌 Research institution CrossBorderCapital estimates that Bitcoin's correlation with global liquidity is as high as 40%.
🔹 M2 money supply (broad money) has started to rebound since hitting a low in January.
🔹 Due to the 40-70 day lag effect of M2 on Bitcoin, a return of market funds may be imminent.
🔹 This means that within at least 20 days, Bitcoin may see an upward trend!
Trade war & liquidity: Has the market fully absorbed this?
🔻 Market concerns over a new round of tariffs have weakened risk appetite, but will this really suppress the market in the long term?
ETF fund flows indicate that institutions have already absorbed the impact of tariffs:
✅ The outflow of ETF funds has significantly slowed down, indicating that institutional investors have not continued to withdraw on a large scale.
✅ This week there has even been some inflow of funds for buying at lows!
✅ Institutions have long been prepared for a downturn, while retail investors' panic selling is the main cause.
📊 The CME futures gap has been filled, selling pressure has decreased
What is the CME gap?
The CME futures market is closed over the weekend, and when the market reopens, if there is a significant price gap, it will form a 'CME gap'.
🔹 The market tends to fill these gaps, leading to increased selling pressure.
🔹 Yesterday's price correction has completely filled the CME gap, this bearish factor has been absorbed!
Is now a good opportunity to buy at a low?
Current market selling pressure mainly comes from:
🔻 Insider traders are positioning short positions ahead of major news
🔻 Leverage long positions have been liquidated, triggering a chain liquidation
🔻 New shorts are entering, increasing short-term selling pressure
📌 However, the real bearish factors in the market have significantly decreased!
📌 Major positive catalysts in the short term: March 7
🔹 We have returned to the price levels before the announcement, and the market fundamentals have not changed.
🔹 The risk/reward ratio (R/R) is extremely attractive, the current level may be an excellent opportunity to buy at a low!
(NFA, not financial advice)
Conclusion:
Is the market adjustment over, and is Bitcoin about to rebound?
✅ Bitcoin's decline is mainly driven by short-term factors, with the return of M2 funds, stabilization of ETF funds, and filling of the CME gap, market panic may have been excessive.
✅ March 7 will be a key turning point for the short-term market, the current position may be a golden opportunity to buy BTC at a low!
✅ Although market sentiment is low, the liquidity cycle tells us that a turning point may be just around the corner.
