- China’s $140B liquidity boost sparks Bitcoin optimism, targeting a potential $78K breakout.
- Historical data shows previous stimulus announcements led to significant Bitcoin price rallies.
- Analysts foresee central bank liquidity as a catalyst for further Bitcoin demand and price growth.
On September 24, the People’s Bank of China (PBOC) announced a stimulus package aimed at boosting liquidity within the financial system. The PBOC committed to injecting $140 billion through a 50 basis point cut in the reserve requirement ratio (RRR).
Additionally, Bitcoin (BTC) has been the focus of market attention, with many analysts predicting a breakout toward $78,000. Past stimulus measures, particularly in 2020, have directly impacted Bitcoin’s rally, with prices often doubling in value.
The latest injection of liquidity by China, paired with its global implications, has sparked optimism for another significant BTC surge.
Jamie Coutts, a senior crypto analyst at Real Vision, pointed out that central bank moves, like the recent one by the PBOC, often create a positive environment for crypto assets. He explained that central bank liquidity might increase demand for Bitcoin, making the $78,000 target seem achievable.
Additionally, Coutts pointed out that this trend could influence other global central banks to adopt similar measures, amplifying the effect on BTC.
Besides the direct effects of the PBOC’s move, broader economic factors such as the easing of property rules are expected to have indirect benefits for Bitcoin. With liquidity flooding the market, investors could seek to hedge against fiat currency debasement, making digital assets like Bitcoin increasingly attractive. Coutts remarked, “In a credit-based system, debasement is a feature, not a bug.”
As of the time of writing, Bitcoin was trading at $63,567, reflecting a slight 0.33% increase within 24 hours. Trading volume has remained steady, indicating both selling pressure and buyer activity. The market cap currently stands at over $1.25 trillion, with nearly 19.76 million BTC in circulation.
Technical indicators suggest Bitcoin’s short-term momentum is positive. The RSI currently stands at 56, signaling that the market remains moderately bullish without being overbought.
Source: TradingView
Meanwhile, the MACD has crossed into bullish territory, indicating potential for further upward price action. However, analysts caution that the current movement may still be in its early stages and will require confirmation from additional market trends.
DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
