The M2 Global Liquidity Index is a powerful trading indicator that visualizes the relationship between global money supply (M2) and asset prices—particularly Bitcoin (BTC)—with customizable forward shifts to anticipate macroeconomic trends.
Key Features
- Current M2 Index: Baseline M2 money supply data (no offset).
- Offset A: User-defined forward shift (default: 78 days).
- Offset B: Secondary forward shift (default: 109 days).
- Extended Currencies: Toggle to include 9 additional central bank currencies (CHF, CAD, INR, RUB, BRL, KRW, MXN, ZAR) for broader liquidity analysis.
- Scaled Visualization: All lines align with the left-hand axis, measured in trillions.
How to Use
- Add the Indicator: Apply it to any chart in overlay mode.
- Configure Offsets: Navigate to Settings → Inputs to adjust Offset A and Offset B (days).
- Toggle Extended Currencies: Enable for a comprehensive global liquidity perspective.
- Analyze Correlations: Observe how asset prices (e.g., BTC) align with shifted M2 trends to identify potential reversals.
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Why It Matters
Changes in global money supply often precede price movements in risk assets by weeks or months. This tool simplifies testing and visualizing these correlations directly on your charts.
FAQ
Q: How do M2 shifts predict BTC price movements?
A: Historical data shows that liquidity expansions/contractions often lead BTC trends. The offsets help project these effects forward.
Q: Which currencies are included in "extended" mode?
A: CHF, CAD, INR, RUB, BRL, KRW, MXN, and ZAR—adding depth to the global liquidity snapshot.
Q: Can I use this for assets other than BTC?
A: Yes! The indicator applies to any asset influenced by macro liquidity trends (e.g., stocks, commodities).
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