Global Liquidity Cycle Peaks Signal End of Bitcoin Bull Run
Global liquidity cycle appears to have peaked as post-pandemic fiscal stimulus gives way to a private-sector-led phase. Tariff hikes and cuts under the ’Big Beautiful Bill’ are draining liquidity, while Treasury QE via short-term bills fades. The Global Liquidity Index has reached historical highs, and rising debt-to-liquidity ratios threaten trillions in maturing debt. Commodities such as gold, silver and copper have been the last to rollover. As the global liquidity cycle contracts, traders should prepare for rotation from risk assets into cash and bonds and monitor liquidity indicators to manage risk. Bitcoin’s bull run often ends months before a liquidity downturn, making its recent peak a key signal.
Bearish
News of the global liquidity cycle peaking and fiscal stimulus waning creates a bearish outlook for Bitcoin. In the short term, traders may rotate out of risk assets into cash and bonds, increasing selling pressure on BTC. Rising debt-to-liquidity ratios and fading Treasury QE reduce the liquidity that has fuelled past crypto rallies. Historically, Bitcoin’s bull market has ended months before liquidity downturns, suggesting limited upside ahead. In the long term, if monetary policy shifts or fresh stimulus returns, liquidity conditions may improve, offering potential relief. However, current fiscal policy cuts and higher tariffs indicate a sustained period of tighter liquidity. Crypto traders should therefore be cautious, using shorter timeframes for entries and protecting gains until a clear liquidity rebound emerges.