Liquidity Wave Fuels Markets

Key Takeaways

• Global liquidity at ATHs, rate cuts expected, and risk assets continue pushing higher
• Bitcoin consolidating with technical upside targets of $140k–$165k
• Mid & low cap coins showing bullish setups with historical Q4 strength as a tailwind

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Digital Asset Commentary

Global liquidity measures have surged to fresh all-time highs (ATHs), coinciding with a 3% slide in the US dollar since August. The FOMC meeting this week carries significant weight, as markets have priced in a near-certain rate cut amid a weakening jobs market, with odds suggesting two additional cuts before year-end. A dovish tone from Chair Powell could act as further fuel for risk assets, though much of this has been anticipated since the Jackson Hole conference. Gold has extended its momentum toward new highs, while equities remain strong, Google crossing the $3 trillion market cap milestone, Tesla rallying over 20% in two weeks, and Amazon, Meta, and Uber consolidating around record levels.

In digital assets, Bitcoin has remained rangebound since July, consistent with seasonal trends that often see Q3 consolidation followed by explosive Q4 rallies. BTC has found support at the 20-week moving average, and historical tolerance of 1.5x moves above that level suggests upside potential toward $165k. Technicals also highlight an active Cup and Handle pattern, with a declining volume profile that implies a breakout target zone of $140k–$160k. ETH, by contrast, has also consolidated since August, with mixed signals between bullish continuation and bearish reversal. Meanwhile, Solana has outperformed with gains exceeding 50% over the same period, signaling positive liquidity rotation down the risk curve and supported further by fresh stablecoin issuance.

Mid and low-cap tokens have largely remained in multi-month consolidations, many forming inverted head-and-shoulders structures that could act as springboards in the next rotation. Historically, altcoins have demonstrated their strongest relative momentum and froth during Q4, suggesting the stage is set for a broader digital asset rally should liquidity conditions remain supportive.