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As of the writing of this article, Bitcoin 
$107,611 is priced at $84,000, while altcoins remain relatively calm. Trading volumes have significantly weakened, casting a shadow over the market. Starting Sunday with some positive news would be a great way to set the tone for the week. Therefore, let’s look at three major cryptocurrency signals that indicate a potential rise.
Fed’s Tightening Phase Ending
The reversal of tight monetary policy will act as a significant catalyst for risk markets, including cryptocurrencies. Even as Bitcoin approaches six-digit levels, the Federal Reserve continued its balance sheet contraction. Although they started to cut rates at the end of last year, the Fed has yet to reverse its tight monetary policy.
Polymarket data has become much more compelling with Trump’s potential election victory. While mainstream analysts predict a Harris win, Polymarket offers consistent and close-to-result data. Currently, the likelihood of the Fed ending Quantitative Tightening (QT) before May has reached 100%.
Kyle noted that Polymarket is pricing a 100% chance for the Fed to end QT before May. He mentioned that if Powell hints at “QE” in the next FOMC meeting, markets will react rapidly. However, he suspects Powell will keep things ambiguous.
M2 Money Supply Dynamics
We are currently experiencing days of expanding global liquidity. Recently, this topic was discussed at length. Particularly, the shift to expansionary strategies by the EU and China will eventually compel the US to end QT. The Kobeissi Letter highlighted the fastest increase in the last 30 months, sending a significant signal to risk markets.
The growth of the US money supply is accelerating, with M2 rising by +3.9% annually in January, marking the fastest growth in 30 months. The amount of circulating US dollars reached $21.6 trillion, just $16 billion below the all-time high in April 2022. Global money supply also increased by approximately $2 trillion in the last two months, reaching the highest level since September 2024.
Lessons from the 2021 Bull Market
Recent Bitcoin sell-offs were triggered by individual investors capitulating. Various reasons have been cited for this, including the nervousness of short-term investors following Trump’s election. Beanie warns that crypto bears may face a harsh reality, recalling past market behaviors.
He remarked that recent Bitcoin sell-offs were largely a result of individual capitulation, reminiscent of events in 2020. It did not take long to see how disastrous this was for bears in 2021.
