Bitcoin Liquidity Boost: U.S. Treasury’s $10B Debt Buyback spikes Crypto market
The largest U.S. Treasury buyback in history has just taken place with a $10 billion purchase. On the news Bitcoin has spiked nearly $3,000 so far on Friday. With such a big influx of liquidity and more to come, could this provide the boost that sends Bitcoin into its next upward stage of the bull market?
Treasury buyback cancels out Trump/Musk spat
Today’s announcement by the U.S. Treasury that it had bought $10 billion of its debt was enough to spike the crypto market back to the upside. Only yesterday, $BTC had fallen as low as $100,500 on the back of the enormous spat between President Trump and Elon Musk. The highly public war of words between these two iconic world figures was hugely detrimental to the US on the world stage and markets fell accordingly.
Less than a day later, early on Friday morning, the $10 billion U.S. Treasury buyback had the complete opposite effect on markets and Bitcoin shot back up into safer territory.
Treasury buybacks can generally have the impact of helping to weaken the dollar by increasing liquidity in financial markets. In addition, it may reduce pressure on bond yields which can also lead to a more favourable environment for Bitcoin.
$BTC bounces from bottom of descending channel
Source: TradingView
In the short-term time frame it can be seen how quickly the $BTC price bounced back from the 5.15% fall from top to bottom experienced on Thursday. The descending channel is doing its job, and the lower trendline acted as support for the price even though a wick down took the price very near to the $100,000 horizontal level.
Having reached the $104,000 resistance level the price surge has come to a halt. It now remains to be seen if the bulls can continue the upward surge, breaking through the horizontal resistance and the top of the descending channel, or whether the bears will be able to put a stop to the upward movement. The touch of the $104,300 horizontal resistance may even be a confirmation of the breakdown past this level.
Positives build on weekly time frame
Source: TradingView
The weekly time frame for $BTC is looking very positive. If the price can hold the horizontal support formed by the candle tops in December 2024, and the recent price action, this can become the base for the next upward surge.
Towards the bottom of the chart, the Stochastic RSI does have the indicators angled down, but if price does start to move up this can change.
At the very bottom of the chart, the Hash Ribbons indicator has just produced a very bullish blue signal. These are generally emitted at the bottom of large upward price impulses.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
