Global Liquidity Turns Negative Again – What Does it Mean for Bitcoin?
Global central bank liquidity has once again turned negative on a 30-day basis, signaling a shift that historically precedes corrections in both equity and crypto markets.
The update, provided by Alphractal, shows a marked decline in central bank liquidity flows, a trend now visible on their updated chart.
What Does This Mean?
The contraction in liquidity points to tighter monetary conditions—such as rising interest rates, reduced bond-buying programs, or the removal of fiscal stimulus. When liquidity dries up, the flow of capital into risk assets like stocks and Bitcoin slows, often triggering increased selling pressure and risk-off sentiment.
Why It Matters
Liquidity changes serve as a leading macroeconomic indicator, helping investors anticipate market conditions before price action reflects them. Historically, when liquidity rises, markets rally as capital seeks higher-yielding opportunities. When liquidity falls, the reverse happens—risk appetite fades, and volatility tends to rise.
Alphractal’s chart highlights a clear pattern: each previous dip into negative liquidity territory has coincided with either sharp corrections or prolonged sideways action in Bitcoin and equities. The latest reversal suggests traders should be cautious as markets may be entering another liquidity-sensitive phase.
Investor Takeaway
Global liquidity trends remain a critical variable for macro-focused investors. With the latest 30-day measure now in red, markets could face renewed headwinds unless liquidity conditions improve. Expect heightened sensitivity across asset classes in the near term.
Kosta Gushterov
Reporter at Coindoo
Kosta has been a part of the team since 2021 and has solidified his position with a thirst for knowledge, incredible dedication to his work and a “detective-like” mindset. He not only covers a wide range of trending topics, he also creates reviews, PR articles and educational content. His work has also been referenced by other news outlets.
