Liquidity Regime Reset: Strategist Says Fed Cuts, Policy Shifts, and Regulatory Clarity Strengthen Bitcoin’s Long-Term Thesis
Bitcoin extended its decline on Friday, falling 3% intraday and breaking below the $95,000 threshold as macroeconomic signals triggered renewed repositioning across digital-asset markets. According to James E. Thorne, Chief Market Strategist at WellingtonAltus, the latest BTC price pullback comes amid structural changes within the Federal Reserve, and rising institutional interest in Bitcoin.
Thorne argues that the U.S. government’s reopening after a 43-day shutdown and the Treasury’s renewed management of the Treasury General Account (TGA) signal an imminent injection of liquidity into financial markets.
He expects quantitative tightening to end shortly, paving the way for continued rate cuts until the federal funds rate drops toward 2.75%. In his view, the 2026 reshaping of the Federal Open Market Committee, including the replacement of Chair Jerome Powell, will mark the end of Progressive Left Keynesian influence at the Fed.
Thorne identifies a housing recession as the direct consequence of the Fed’s policy mistakes, noting that backward-looking indicators and overtightened financial conditions have distorted credit availability.
Yet despite these headwinds, he highlights surging Bitcoin adoption driven by forthcoming regulatory clarity and the unmatched digital scarcity of BTC. Institutional engagement continues to deepen as Wall Street integrates Bitcoin across trading, custody, and structured-products.
Thorne concludes that selling Bitcoin during a liquidity expansion cycle reflects persistent investor irrationality.
Bitcoin Price Forecast: Can BTC Reclaim $100K After a 55% Downside Probability Signal?
Bitcoin trades at $95,558, sliding deeper into a corrective phase as sellers maintain control. The Parabolic SAR dots remain firmly above price action, signaling continued trend weakness. The Breakout Probability model shows a 55.57% downside skew, with only 31.66% upside, reinforcing the bearish near-term structure.
Momentum remains fragile. The daily RSI sits at 31.15, near oversold but lacking any bullish divergence.
The BBP indicator prints a deep negative −11,537, confirming that bearish momentum is accelerating rather than stabilizing. Moving averages offer little relief, with BTC trading well below the 50-day, 100-day, and 200-day SMAs , all clustered around $110,000 to $112,000 now acting as layered resistance.
A clean bounce from $94,500 is critical to avoid a deeper slide toward $92,000, the next high-liquidity support zone. If buyers defend this region, a recovery toward $100,000 becomes feasible, followed by a retest of $105,000 should momentum improve. The bullish continuation setup only activates if BTC breaks above $110,078, the SAR and SMA confluence level that currently caps the structure.
Related: ‘Good News Is Bad News’: Why the Shutdown’s End Is Hurting Bitcoin
Invalidation occurs on a daily close below $92,000, which would confirm a broader bear cycle extension, potentially exposing $88,500 next.
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