- Bitcoin rises above $73K as ceasefire and M2 growth boost liquidity and trigger short liquidations.
- U.S. money supply hits $22.67T with sustained expansion supporting crypto market momentum.
- Analysts warn of a possible pullback as Bitcoin remains within the $60K to $75K range.
Bitcoin rose above $73,000, as easing geopolitical tensions and continued growth in U.S. money supply combined to boost market momentum. The move followed a temporary ceasefire between the United States and Iran, while new data showed U.S. M2 money supply reached a record $22.67 trillion in February, reflecting a 4.8% year-over-year increase.
At the same time, liquidity conditions remained a key focus for market participants. Data shared by The Kobeissi Letter showed that U.S. M2 has now increased for 24 consecutive months and stands at about $700 billion above its March 2022 peak. Since 2020, the money supply has expanded by about $7.1 trillion, leading to long-term financial accommodation.
As this backdrop unfolded, Bitcoin’s rally surged, leading to more than $293 million in short liquidations. The forced closure of bearish positions added buying pressure, strengthening the price move. At the time of writing, Bitcoin was trading at $72,900, holding most of its gains. CoinMarketCap data recorded a 24-hour trading volume of $36 billion and a market capitalization of approximately $1.45 trillion.
Related: Bitcoin Near $72K as $1.94B Options Expiry Meets Hormuz Disruptions
Meanwhile, geopolitical developments added an additional catalyst. The pause in U.S. military activity against Iran reduced concerns over possible disruptions in the Strait of Hormuz, a key global oil route. As a result, broader markets reacted, with equities moving higher and oil prices declining.
Bitcoin moved alongside these risk assets, reaching a three-week high, according to a Bloomberg report. Analysts noted that a sustained move above $73,500 could open the path toward $80,000. However, the asset has remained within a $60,000 to $75,000 range since the conflict began in late February, indicating that the recent breakout is still forming within an expected trading band.
Bitcoin’s Structure Points to Potential Volatility
Despite the upward movement, market structure shows that uncertainty remains. Analyst KillaXBT indicated that Bitcoin’s recent price behavior aligns with a pattern seen in previous cycles, where periods of accumulation are followed by distribution near local highs.
In this backdrop, historical price action shows that upward diagonal trends are often followed by retracements to lower levels. According to his chart, he highlights earlier distribution phases, followed by declines and consolidation, before moving into a stronger bullish trend.
Related: Bitcoin’s $80K Call Surges, Signaling Bullish Turn
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