Global Liquidity Updates

Our liquidity heatmap continues to show strength and resilience this past week, with clustering green plots indicating positive momentum.

A similar pattern emerged around this time last year, where market speculation was followed by a timely surge in liquidity.

This momentum comes amid stabilizing bond market conditions, highlighted by a decline in the MOVE index, which has supported risk-on sentiment.

However, potential risks such as rising inflation and central bank policy shifts should be monitored closely as they could influence the trajectory of liquidity into the future.

Looking ahead, we anticipate more liquidity inflows in Q4 as per our AE Global Liquidity seasonality data, which could provide a supportive backdrop for major assets, including Bitcoin.

At this point, any dips moving forward should be treated as strategic buying opportunities.

The stage appears set for a promising transition into 2025, where continued liquidity dynamics will likely play a critical role.

The Week That Will Go Down in the History Books

‍What a week.

We truly got what we wished for.

Donald Trump's recent presidential win has sent the entire market into euphoria.

That said, not everything is looking bright.

The recent increase in global liquidity has largely been driven by a strengthening collateral multiplier, which has provided temporary support to global financial conditions.

Meanwhile a slowdown in China's credit and liquidity availability, along with weaker than expected bank loans for October - point towards fundamental challenges.

Currently, there's no big underlying fundamental strength behind this rally in Bitcoin, and central banks are keeping a cautious position.

To top that off - inflation is set to pick up faster in '25, following Trump's win.

To sum it up: this current environment may lead to some unwanted obstacles.This, however, visibly isn't the time to be shying away from risk-on assets.

A similar situation occurred around the same time last year, where speculation drove the market and liquidity came in clutch later on.

With that said, we anticipate more liquidity inflows in Q4 so any dips until further notice, are dips for buying.Data-wise, GL has surged by 4.37% this week, lifting the AE GLI to $131.263 trillion (from last week's $125.764 trillion).

The 3-month RoC has indicated a slight reversal to the upside, solidifying the bullish trend.

Översätt inlägget

As announced recently, we're now showcasing our Global Liquidity Bands - optimized for Ethereum.

‍

Admittedly it's not as correlated to liquidity as Bitcoin, but still it's hard to deny correlation between Ethereum and liquidity, given how decent it signals local tops and bottoms.

‍

Ethereum is currently stealing lots of spotlight and thus gaining momentum.

There's, however, a likelihood of it reverting from the ~$3.6k level as it hits the top band, due to lack of liquidity injections - provided it convincingly flips the ~$3.1k level from resistance into support.

‍

Of course, this is subject to change as the bands are dynamic and updated according to liquidity net flows.

‍

We'll be monitoring this closely and sharing updates moving forward.