During Thursday’s Asian trading session, Bitcoin saw a rise, trading around $114,200. This represents a 2.4% increase compared to its value 24 hours prior, as major cryptocurrencies gained ground amidst a week packed with significant macroeconomic data releases.
Ether (ETH) also experienced a 2.4% jump, reaching $4,400. XRP surpassed the $3 mark, while BNB Chain’s BNB (BNB) approached $900. Solana’s SOL (SOL) saw gains of almost 3%. Dogecoin stood out, increasing by 5% for the day and extending its upward trend to 15.9% over the past week.
A valuation analysis is gaining traction among some market participants. CF Benchmarks released a report earlier this week suggesting that Bitcoin’s current trading price is below its estimated fair value when compared to the growth of the U.S. M2 money supply.
The report highlights that the disparity between M2 expansion and Bitcoin’s price is currently as significant as it was in August 2024, a period that subsequently proved to be a favorable entry point for investors. Similar patterns observed in 2016, 2019, and 2021 were followed by substantial price increases.
Historically, Bitcoin has demonstrated a positive correlation with the M2 money supply over the last decade, with monetary growth typically preceding price movements by approximately three months. Should this historical trend persist, increased liquidity in the latter part of the fourth quarter could drive prices higher.
From a tactical viewpoint, buyers are aiming to secure further price gains.
“Bitcoin is consistently finding buyers during intraday dips, which is creating a subtle, yet fragile upward price trend. The $112,000 level is currently the key area of contention,” commented Alex Kuptsikevich, a leading market analyst at FxPro, in correspondence with CoinDesk.
“The real challenge lies near $115,000, just above the 50-day moving average. A sustained hold above this level would indicate a return to a more optimistic outlook. However, at present, Bitcoin’s performance is lagging behind stocks, which are currently at record highs,” Kuptsikevich added.
Options traders are reporting increased demand for downside protection ahead of the upcoming U.S. inflation data release this week, indicating a somewhat cautious or bearish sentiment in the near term.
Meanwhile, the total value locked (TVL) in Solana’s ecosystem has been steadily increasing, reaching a record $12.2 billion, a 57% surge since June, with increased interest in meme coins. Analysts suggesting $300 price targets for SOL cite consistent activity and on-chain liquidity as supporting factors, but ultimate progress is tied to general market sentiment.
However, the macroeconomic landscape could still disrupt the positive momentum. The U.S. Consumer Price Index (CPI) figures are scheduled for release later today. A moderating CPI trend would bolster the case for a near-term interest rate cut by the Federal Reserve and a weaker dollar, factors that generally benefit Bitcoin and the broader cryptocurrency market.
Further Reading: Bitcoin, Ether ETFs See Inflows as Prices Recover
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