Following the U.S. Federal Reserve’s decision last Wednesday to lower the dollar interest rate by 50 basis points, the crypto market has responded positively. Bitcoin has climbed 5.56%, while Ethereum has surged 15.25%.

The market conditions are increasingly aligning for a major upward move. This is supported by a few key factors: historically strong seasonal trends, the post-fourth Bitcoin halving period, which has typically delivered strong returns, the potential for favorable attention on crypto during the U.S. presidential election, and, most importantly, a market that performs well in a low-interest-rate environment.

However, this week we are facing a notable liquidity crunch, as illustrated in Chart 1. Fortunately, liquidity is expected to improve in October, so we just need to get through this short-term pressure. After that, the macroeconomic conditions, such as liquidity and the lower interest rates, support the aforementioned factors in a bullish move in the crypto market.