Where Things Stand With Bitcoin: Bull Market Update

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Market Overview

Bitcoin is in a ranging, choppy period.

There are no two ways about it.

But…

Nothing is bearish about it.

It’s just setting up a solid base for another leg higher which could come in 1, 2, or 3 months.

We doubt we will consolidate for 8 months like we did last summer.

However…

We can’t say that about other coins.

Every other altcoin got recked on Monday. Every altcoin retraced the entire election pump.

While Bitcoin is chopping, alts will continue to bleed.

This only reinforces the insurmountable dominance of Bitcoin.

SO…

What should you be looking at to determine when the next phase of the bull run will start?

There are multiple catalysts.

In fact, there are SO MANY positive catalysts ahead for Bitcoin:

1. The Bitcoin Strategic Reserve.

2. US Sovereign Wealth Fund.

3. Increasing widespread adoption by companies.

4. The launch of X Payments (on Twitter) which will undoubtedly include Bitcoin.

5. A supremely pro-crypto US administration that will ease regulations and approve a whole host of different crypto ETFs.

But most importantly…

Growing MONETARY SUPPLY (M2).

EXPLANATION 

This is the chart of Bitcoin with M2 lagged by 77 days layered on top of it.

The correlation is staggering.

Bitcoin topped exactly when M2 topped. (That’s something we actually called for back in December.)

AND…

You can see how every trough in M2 aligns perfectly well with Bitcoin’s bottoms.

If we’re to expect the correlation to continue, which is a valid assumption…

We should expect Bitcoin to rally into the 100s once more before dropping and ranging again.

Hence, confirming that we’re in a mean reverting state.

M2 Projections

The positive thing is that money supply is continuing to grow steadily across the world.

Most major central banks will continue to cut rates, and that will lend itself to even more growth in M2.

The reason this growth is not saliently visible on the M2 chart is because the US dollar has grown stronger at a very fast rate.

But, we strongly believe that the US dollar has topped for now.

Trump will undoubtably pursue a weak-US dollar policy. He has to. He has no choice. Every economic goal of the Trump administration is only possible with a weaker US dollar.

So that is VERY good news.

Because it means that money supply doesn’t have to grow to insane levels for M2 to grow and hence for Bitcoin to rally.

As for tariffs, they will eventually be viewed as a positive thing.

If not for anything else, it indicates that whatever Trump promised to do, he’s ACTUALLY doing it.

Which means Bitcoin Strategy Reserve is happening.

Which is even more good news.

Layer ALL that on top of an expanding Business Cycle… and risk assets are expected to have a very good year in 2025.

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Optimal Holdings: 

Here is our Optimal Portfolio:

We’re keeping 5% in cash ready to deploy whenever the market trends agains so we can enter in leverage.

At that point, we’d also consider rotating the remaining 5% in SOL into leverage.

We’re keeping it for now because it’s the only solid altcoin out there for the moment.

While ETH will likely rally at some point, we think SOL will dominate more.