Money Supply: The Indicator That Dominates Gold and Bitcoin Behavior in 2026

The money supply in the United States has become the key factor in understanding the price divergence between two of the most followed assets by investors: gold and bitcoin. While the former accelerates its annual rally, the latter is struggling around critical support levels that will determine its next direction.

Gold reaches levels not seen in decades

The precious metal is breaking through a resistance zone that hasn’t been reached since 2011 and that held for decades during the 1970s. Back then, the price tripled to reach $700 per ounce. History seems to be repeating itself: with M2 money supply expanding significantly, gold has jumped from $1,800 in 2011 to around $4,500 today.

This movement represents a 70% increase so far this year, solidifying gold as the preferred safe haven amid macroeconomic uncertainty. When evaluated against the total circulating money supply — including cash, bank deposits, and liquid savings — gold’s performance takes on new significance: it is challenging a decades-old resistance level that was only sustainably surpassed during the inflationary boom of the 1970s.

Bitcoin finds firm ground at key support

In contrast, bitcoin has fallen about 10% while trying to consolidate a support zone near the lows recorded during the tariff turbulence of April. Importantly, this level also coincides with the previous cycle’s high in March 2024, a pattern that analysts consider structurally significant.

The cryptocurrency is currently trading around $70,510, showing resilience against external pressures. According to experts, bitcoin’s price continues to set new relative highs when compared to the money supply in each market cycle. This relationship suggests that, despite nominal declines, bitcoin maintains its strength in real terms when adjusted for the expansion of circulating money.

Altcoins and equities follow the upward trend

Alternative cryptocurrencies, including Ethereum, Solana, and Dogecoin, rose about 5% in recent sessions. This movement aligned with a favorable performance in broader equity markets: the S&P 500 and Nasdaq each increased by approximately 1.2%. Shares of cryptocurrency mining companies also participated in this rally, reflecting a renewed risk appetite.

Geopolitical factors that could redefine the narrative

Analysts emphasize that bitcoin’s next move will depend heavily on external developments. After President Donald Trump announced a five-day pause in operations against Iran’s energy infrastructure, a window of relative calm opened in the oil markets.

If oil prices and maritime transportation through the Strait of Hormuz remain stable, there is potential for bitcoin to retest the $74,000 to $76,000 range, supported by positive behavior in the money supply. Conversely, if geopolitical tensions escalate, prices could fall back toward $60,000, eroding recent gains.

The money supply as a market compass

The expansion of the M2 money supply continues to be the decisive backdrop for both assets. Gold benefits directly from an expansionary money supply as a hedge against inflation, while bitcoin has shown increasing correlation with these macroeconomic dynamics. This connection will become even more critical in the coming quarters, as central bank monetary policy decisions will determine whether we remain in a regime of easing or tightening.