Crypto Market Up to $3.1T as Fed Balance Sheet Nears $6.56T; Short‑Term BTC Holders Recover
Crypto market capitalization rebounded to about $3.1 trillion as traders focused on the Federal Reserve’s weekly balance sheet, which stands near $6.56 trillion. The Fed’s H.4.1 release (4:30 p.m. ET weekly report) gives markets an updated view of total assets. Some macro-crypto traders treat the $6.55T level as a psychological liquidity reference, arguing readings above it could boost risk assets, though this is market conjecture rather than Fed guidance. On-chain metrics show short‑term Bitcoin holders recovering from an extreme loss phase: the short‑term holder supply profit/loss ratio has lifted off prior “max pain” lows and is trending toward break‑even, suggesting many recent buyers have absorbed losses. Technicals on the total crypto market 4‑hour chart show market cap moving above the 50‑period EMA (~$3.02T) and a 14‑period RSI near 66, signaling improving momentum after mid‑November sell‑offs. Volume was higher on the bounce, indicating buyer participation but easing as price nears $3.1T. Analysts caution that these signals reflect interpretations and not guaranteed trend reversals; traders will watch continued short‑term holder stability, spot flows and Fed balance‑sheet updates for confirmation. Key figures and data: Fed balance sheet ~ $6.56T; crypto total market cap ~ $3.1T; 50‑period EMA near $3.02T; short‑term BTC holder profit/loss ratio recovering; 14‑period RSI ~66.
Bullish
The news combines macro liquidity metrics and constructive on‑chain and technical signals, which together point toward a bullish bias. A Fed balance sheet trending near $6.56T has become a liquidity reference for traders; if perceived liquidity stabilizes or rises, risk appetite for crypto typically increases. On‑chain data showing short‑term Bitcoin holders recovering from “max pain” implies reduced forced selling pressure and a potentially firmer bid for BTC and correlated assets. Technicals on the total market — price above the 50‑period EMA and RSI climbing toward 66 — indicate momentum has shifted away from sellers after the mid‑November drawdown. Volume profile (higher on the bounce) supports genuine buying interest rather than a thin rally. Historically, similar episodes (central‑bank liquidity stabilization + capitulation in short‑term holders) have preceded multi‑week recoveries in risk assets and crypto — though not always uninterrupted. Key caveats: the Fed reading itself is routine; market interpretation can be speculative and short‑lived. A bullish case would be invalidated by renewed liquidity tightening, weak spot inflows, or a resumption of large-scale selling by holders. Short term: likely continued upside or consolidation with reduced volatility if on‑chain recovery sustains. Long term: dependent on macro liquidity trends and adoption flows; if the Fed balance sheet stabilizes or grows, the bullish structural case for higher crypto market cap strengthens.