When will liquidity return to the cryptocurrency market?

The beginning of January is traditionally characterized by sluggish market activity, and this week was no exception. According to analysts at Danske Bank, a turnaround is expected as early as next week. The reason is simple — market participants are gradually returning from vacations, and most importantly, the calendar is filled with important macroeconomic reports.

What will change the liquidity situation

Two major events are the foundation of the expected recovery in activity. On January 9, US employment data for December and the ISM index will be released. These indicators have the potential to awaken the dormant market and restore traders’ risk appetite.

Jens Nørvig Pedersen, a strategist at Danske Bank, emphasizes that the current stagnation is temporary. The period from the end of the year is traditionally characterized by low liquidity — traders close positions, transfer their assets, and many are simply on holiday.

Why this is important for the cryptocurrency market

The recovery of liquidity in traditional financial markets usually positively impacts the crypto sector as well. When new data appears and the interest of major players grows, cryptocurrency pairs begin to revive. Trading volumes start to increase, spreads narrow, and volatility becomes more predictable.

Experts expect that starting from next week, we will see a noticeable improvement in trading conditions. This could be a key moment for positioning ahead of a more active period.