Market analysts are closely monitoring the expansion of the M2 money supply in the United States, as it is believed to potentially influence further upward momentum for Bitcoin. Historically, the growth of the M2 money supply has shown a correlation with previous Bitcoin price surges, leading experts to speculate on its potential implications for the cryptocurrency's future path.

Jamie Coutts, chief crypto analyst at Realvision, suggests that the growth of the M2 money supply could act as a catalyst for the next Bitcoin bull run. Coutts emphasizes the strong correlation between M2 money supply growth and Bitcoin bull cycles, highlighting its significance within his Bitcoin/Liquidity framework. He points out that among the key metrics he monitors, Global M2 seems to capture a significant portion of Bitcoin's movements. Furthermore, Coutts indicates that the rate of change in the money supply holds more weight for Bitcoin price than its nominal value, with shifts in M2 momentum often aligning with movements in Bitcoin's price.

Recent data revealing a positive year-over-year growth in the M2 money supply since November 2023 suggests that investors may seek inflation hedges like Bitcoin. Coutts also notes that the performance of the U.S. dollar could impact Bitcoin's price, especially if the dollar weakens below the 101 mark.

On May 16, Bitcoin broke its month-long daily downtrend, signaling a potential shift towards an uptrend, as highlighted by popular crypto analyst Rekt Capital. This breakout indicates the potential for Bitcoin to establish its first Higher High since hitting a low of $56,000. However, the relative strength index (RSI) reached 77 before retracing to 66, suggesting that Bitcoin might need further consolidation before experiencing significant upward momentum.

Despite the positive developments, Bitcoin faces significant resistance around the $66,500 level. A potential move above this threshold could trigger the liquidation of over $111 million worth of leveraged short positions across all exchanges, according to Coinglass data.

As analysts continue to monitor the dynamics of the M2 money supply and Bitcoin's price movements, the cryptocurrency market remains poised for potential shifts based on macroeconomic factors and market sentiment. The interplay between monetary policy, inflation concerns, and Bitcoin's price performance underscores the intricate relationship between traditional financial indicators and the evolving landscape of digital assets.