According to traditional financial advice, it is common for investors to "Sell in May and go away" to avoid summer market fluctuations. However, there is a belief that this advice may not apply to Bitcoin in the upcoming month due to various reasons that indicate a possible increase in prices instead of a decline.
One significant factor is how Bitcoin is currently closely correlated with the global M2 money supply, which measures the circulating money in the economy, including cash, savings deposits, and other liquid assets. Historically, there has been a strong connection between M2 and Bitcoin prices, with Bitcoin typically rising when central banks like the FED, ECB, or PBoC increase the money supply.
Data and analysis support the idea that this trend will continue in 2025, potentially making May a pivotal month for Bitcoin. Despite differing opinions among analysts, investors are increasingly adopting this perspective, leading to a positive market sentiment.
Looking at historical data, it is evident that Bitcoin has shown an average return of over 7.9% in May over the past 12 years, as reported by Coinglass. While traditional financial markets usually experience summer turbulence, Bitcoin often demonstrates positive performance in May, outperforming the following months of June and September.
Furthermore, the surge in investments in Bitcoin ETFs, as indicated by BeInCrypto, reflects a growing investor confidence in Bitcoin's long-term prospects for 2025. This increased interest may potentially drive Bitcoin prices upward in May.
Additionally, Bitcoin appears to be decoupling from traditional indexes like the S&P 500, indicating potential large price surges. This independence from traditional markets is seen as a positive sign by bullish analysts, suggesting that the old adage of "Sell in May and go away" may not be applicable to Bitcoin this year.
While factors such as key data from the Fed, including CPI, interest rates, and trade tension updates, could introduce uncertainties in May's outlook, the strong support from M2 correlation, positive historical May performance for Bitcoin, significant ETF inflows, and decoupling from traditional indexes all point towards selling Bitcoin in May 2025 as potentially being a risky decision.