A significant Bitcoin bull signal has appeared for the first time in nearly a year, suggesting a potential price surge. Historically, this signal has been linked to substantial price rallies.
Jamie Coutts, the chief crypto analyst at Real Vision, shared the signal, noting its potential impact on Bitcoin's price. In an Aug. 15 X post, Coutts stated:
“My composite global liquidity momentum model (MSI), has provided the first Bullish regime signal since November 2023. Recall that Bitcoin rallied 75% from Nov to April before the regime flipped Bearish.”
According to Coutts, this same bullish indicator preceded major Bitcoin rallies in past cycles, including a 19-fold increase in 2017 and a six-fold rise in 2020.
Coutts suggests that Bitcoin's price could potentially double or even triple, reaching around $120,000. However, he emphasized that this outcome depends heavily on the performance of the US Dollar Index (DXY) and global liquidity trends:
“For BTC to meet this target, the DXY would need to be well below 101, prompted by ongoing central bank injections. This would push global M2 well over $120T this cycle.”
Despite this optimistic outlook, Bitcoin may face short-term challenges. Over $1.4 billion in Bitcoin options are set to expire on Aug. 16, potentially impacting the price unless Bitcoin recovers above $60,000.
The growing global M2 money supply could provide additional support for Bitcoin. Recent expansions include $400 million from the Bank of Japan and $97 billion from the People’s Bank of China, contributing to a $1.2 trillion increase in the global money base. Coutts explained:
“This is the natural state in a credit-based fractional reserve system. The money supply must continually expand to support the outstanding debt. Otherwise, everything will collapse.”
However, Bitcoin’s price movement will also depend on inflows from US spot Bitcoin exchange-traded funds (ETFs), which have recently seen fluctuations. After two days of positive inflows, ETF inflows turned negative on Aug. 14, with US ETFs experiencing a cumulative $81 million in outflows, according to Farside Investors data.
