The crypto market has shown clear signs of recovery this week after four consecutive weeks of pressure, with the price of Bitcoin (BTC) climbing back above the psychological $90,000 level on Wednesday.
The positive momentum intensified when Cathie Wood, CEO of ARK Invest, firmly confirmed that her long-term Bitcoin price target of $1.5 million per BTC during the current bull market cycle “remains unchanged.” She attributes the market’s resurgence to “massive liquidity flowing back into the system” following the end of the US government shutdown.
🚀 Liquidity Surge: Fed Rate Cuts and Government Funds
The market recovery is coupled with a rapidly increasing probability of U.S. rate cuts. The chance of the Fed implementing a 0.25% rate reduction at its December 10 meeting soared from 39% to 85% within one week, according to the CME Group’s FedWatch tool. This has significantly boosted investor confidence across both stock and crypto markets.
ARK Invest believes the market is forming a meaningful reversal pattern late in the year, estimating that over $70 billion USD has already flowed back into the market post-government shutdown, with another $300 billion USD expected to re-enter the system within the next 5–6 weeks as the Treasury General Account (TGA) rebalances to normal levels.
Another crucial catalyst is December 1, the date when the Federal Reserve is scheduled to end Quantitative Tightening (QT) and prepare to transition toward Quantitative Easing (QE). This policy—involving printing money to purchase bonds to stimulate the economy—typically benefits risk assets, especially Bitcoin.
ARK Invest stated in a post on X:
“With liquidity returning, QT ending on December 1st, and monetary policy turning supportive, we believe the market is creating the right conditions for a substantial reversal from the recent selling pressure in Bitcoin.”
📉 Worst November in 7 Years, But Reversal Signals Are Strong
Despite the sharp price recovery, November is still ranked as Bitcoin's “worst November in 7 years,” remaining down by approximately 17% month-over-month (MoM), whereas November typically yields an average return of 41%, according to CoinGlass data. Nevertheless, the clear signals of liquidity returning and an easing monetary policy trajectory have instilled confidence in investors that the heavy selling pressure witnessed recently has likely concluded.
