bullish

Bitcoin

Arthur

Rekt

Bitcoin is at a “perfect” setup from a macroeconomic perspective, but over $500 million worth of looming liquidations threaten to create more volatility for the world’s first cryptocurrency.
In relation to the global M2 money supply, Bitcoin’s (<a href="https://cointelegraph.com/bitcoin-price" text="null" title="null">BTC</a>) current mid-cycle correction positions it for an imminent bullish breakout, according to Jamie Coutts, a chief crypto analyst at Real Vision.

 <hard_break></hard_break>Coutts <a href="https://x.com/Jamie1Coutts/status/1823319580728869128/photo/1" text="null" title="null">wrote</a> in an Aug. 13 X post:<hard_break></hard_break>
<blockquote>
 “Over the past decade, Bitcoin has had a tendency to trough several months before the bottom in global M2. Then it rips, gets way ahead of the move in liquidity, and has a mid-cycle correction.”
</blockquote>
<figure>
 <img alt="Bitcoin at ‘perfect’ macro setup, but dip below $58K risks $500M in liquidations" name="" src="https://s3.cointelegraph.com/uploads/2024-08/coutts%201">
 <figcaption style="text-align: center;">
 BTC/M2 money supply. Source: Jamie Coutts
 </figcaption>
</figure>

 <hard_break></hard_break>The growing global liquidity from the M2 money supply, combined with the spot Bitcoin exchange-traded funds (ETFs), makes for the “perfect setup” for Bitcoin, added the analyst.
The analysis comes as Bitcoin is recovering from last week’s $510 billion crypto <a href="https://cointelegraph.com/news/crypto-crash-300-billion-largest-three-day-plunge-crypto-one-year" text="null" title="null">market sell-off</a>, which tanked its price to a five-month low of $49,500 on Aug. 5. Bitcoin still remains under the key $60,000 psychological mark.
Related: <a href="https://cointelegraph.com/news/bitcoin-70k-ethereum-4k-altseason-solana-250" text="null" title="null">Bitcoin needs to breach $70K, ETH $4K, for altseason start — Arthur Hayes</a>
<h2 id="nearly-500-million-stands-to-be-liquidated">Nearly $500 million stands to be liquidated </h2>
Despite the bullish macroeconomic perspective, Bitcoin price could still see a correction to the $55,000 mark.
A potential move below $58,000 would liquidate $489 million worth of cumulative leveraged short positions across all exchanges, according to Coinglass <a href="https://www.coinglass.com/pro/futures/LiquidationMap" text="null" title="null">data</a>.

 <hard_break></hard_break>
<figure>
 <img alt="Bitcoin at ‘perfect’ macro setup, but dip below $58K risks $500M in liquidations" name="" src="https://s3.cointelegraph.com/uploads/2024-08/Screenshot%202024-08-13%20151956">
 <figcaption style="text-align: center;">
 Bitcoin Exchange Liquidation Map. Source: Coinglass
 </figcaption>
</figure>
Cumulative short Bitcoin liquidations would surpass $800 million if Bitcoin’s price fell below $57,500.&nbsp;
Related: <a href="https://cointelegraph.com/news/ether-whale-buys-13m-eth-needs-reclaim-2-7k" text="null" title="null">Whale buys nearly $13M of Ether, but price needs to reclaim $2.7K for next leg up</a>
<h3 id="can-bitcoin-break-its-two-week-downtrend">Can Bitcoin break its two-week downtrend?</h3>
Bitcoin is currently unable to break out of its two-week downtrend, which started on July 28.
A successful retest of this downside trend line would enable more bullish momentum, according to popular analyst Rekt Capital, who <a href="https://x.com/rektcapital/status/1823028410995601559/photo/1" text="null" title="null">wrote</a> in an Aug. 12 X post:
“As time goes on, the downtrend represents lower prices, meaning that retest attempts could go to lower prices and still be successful. The key here is trend continuation. Bitcoin needs to experience strong buy-side volume on the retest of the downtrend.”
<figure>
 <img alt="Bitcoin at ‘perfect’ macro setup, but dip below $58K risks $500M in liquidations" name="" src="https://s3.cointelegraph.com/uploads/2024-08/retest%20rekt">
 <figcaption style="text-align: center;">
 BTC/USD, 1-day chart, downtrend. Source: Rekt Capital
 </figcaption>
</figure>
Other analysts are eying a<a href="https://cointelegraph.com/news/bitcoin-price-dip-retest-55k-next-leg-up" text="null" title="null"> potential Bitcoin correction to $55,000</a> before Bitcoin can gain more upward momentum.
Magazine: <a href="https://cointelegraph.com/magazine/china-crypto-ban-investors/" text="null" title="null">How Chinese traders and miners get around China’s crypto ban</a>

Bitcoin at ‘perfect’ macro setup, but dip below $58K risks $500M in liquidations

Table of Contents

Cointelegraph

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