Raoul Pal: Global liquidity is highly correlated with BTC, and the market is historically oversold.

Raoul Pal, in an article on the X platform, stated that while there is widespread frustration with cryptocurrencies and pure technical analysts believe the market is over, he disagrees. Global liquidity is historically the most important macroeconomic factor, with a 90% correlation to BTC and a 97% correlation to NDX since 2012. Its annual growth rate is approximately 10% and shows no signs of slowing down. The GMI (Global Financial Conditions Index) leads global liquidity by about 6 months and remains accommodative. Overall US liquidity was suppressed during the shutdown, entering a bearish phase. This indicator leads cryptocurrencies by about 3 months and has been accelerating from its low point three months ago. The business cycle is a key driver of returns and risks and is accelerating. eSLR (Extra-Sum Lending Rate) is a mechanism by which banks enhance liquidity through lending and absorbing government bond issuance. This liquidity is also rising and will accelerate further. Tax refunds entering bank balance sheets increase the propensity to create credit, thereby increasing liquidity. The US will further cut interest rates, increasing disposable income and thus increasing risk appetite. The CLARITY Act is expected to pass, driving capital inflows. Numerous banks and asset management institutions are eager to use this technology, and this bill will address that need. Stablecoins are rapidly developing, with issuance increasing by 50% last year and still accelerating. Trading volume has reached trillions of dollars and continues to rise. US government support for cryptocurrencies is at an all-time high. Eventually, agencies will be in place, greatly accelerating market development and creating a completely new, serviceable market. The crypto market remains in a state of panic, with most indicators showing it to be at its most oversold level in history. The weekly DeMark indicator will provide very strong support in two weeks (this indicator is now available on Trading View). The daily DeMark indicator is also superimposed. Any weakness from here will complete the daily and weekly indicators, suggesting a potential full trend reversal. The risk factor lies in how long oil prices remain high. The next two weeks are a key period to watch. He believes the above factors will have a positive outcome. Further upside is expected.