The cryptocurrency market downturn has escalated into a deeper correction. Yesterday, Bitcoin (BTC) plunged by another 6% at its lowest point, while Ethereum (ETH) dropped by over 7%. As usual, prices partially recovered, but the growing panic remains. At this stage, no one is immune from a further correction.

Signs of institutional accumulation

On a positive note, crypto exchanges report significant BTC outflows. According to Glassnode, this trend suggests that institutional players are buying Bitcoin, taking advantage of retail investors capitulating. The redistribution of assets from short-term speculators to long-term holders is nothing new.

Institutional investors typically have longer investment horizons and are less prone to panic during short-term price fluctuations. However, it's important to note that Glassnode data is just one indicator. So, it would be premature to rely solely on it to predict market movements.

Indeed, if BTC outflows from exchanges continue, this could lead to a supply shortage, which in turn may support a price rebound.

M2 liquidity expansion: a bullish signal?

Meanwhile, global M2 liquidity growth is still accelerating, historically serving as a bullish signal for risk assets, including cryptocurrencies. At the same time, current market conditions are shaking out speculators and leveraged traders, which could increase the likelihood of a crypto market recovery in the near future.

However, the effects of M2 growth do not manifest immediately. It usually takes several months for markets to fully react to changes in money supply, as liquidity moves through different stages—from banks to end consumers and investors.

Besides, other factors can offset the impact of M2 expansion, including:

• Interest rates;
• Inflation;
• Geopolitical risks

If these factors exert downward pressure on the market, even an increase in liquidity may not result in a significant rise in risk assets. Nevertheless, the current M2 trend remains a positive indicator for the crypto market. If this trend persists, we could see further price growth in the coming months. However, investors should exercise caution and take all risk factors into account before making investment decisions.

Historically, BTC follows global M2 liquidity trends with a 1–3 month lag. If this correlation holds, Bitcoin's local bottom could form in the range of $75,000 to $80,000.

Bitcoin technical outlook

Bullish targets:

$86,600 – key recovery level, opening the way to $87,900

$89,200 – next resistance level

$90,700 – final bullish target, signaling a return to the mid-term uptrend

Bearish scenario:

$85,200 – first key support level

$83,800 – potential downside target if BTC falls below $85,200

$82,500 – final bearish target

Ethereum technical outlook

Bullish targets:

$2,387 – key breakout level, opening the way to $2,439

$2,490 – one-year high, breaking above this level would confirm a return to the mid-term uptrend

Bearish scenario:

$2,330 – first key support level

$2,275 – potential downside target if ETH drops below $2,330

$2,217 – final bearish target

Conclusion

The crypto market remains under significant pressure, with panic selling driving prices lower. However, institutional accumulation and increasing global liquidity (M2) provide potential support for a future rebound. Bitcoin and Ethereum remain above key support levels, and if current trends persist, a market recovery could take place in the coming months. Therefore, investors should stay cautious, as macro risks and market volatility remain high.