Something subtle but important is happening beneath the surface of the market. The Federal Reserve’s latest cash infusion, totaling $8.306 billion and settling tomorrow, comes just at a time when investors are already nervous, defensive and waiting for a cue or two from the market.
The anxiety is reflected in price developments. A new gold ATH of $4,717 per ounce is proof of this, while Bitcoin USD falls into the $95,000 support zone. However, when the Federal Reserve injects liquidity and gold maintains its ATH behavior, Bitcoin USD prepares for a takeoff.
The New York Fed focused this operation on Treasuries maturing between February and May, a narrow window with its own history. By injecting liquidity directly into banks, the Federal Reserve ensures that reserves remain sufficient without reopening the political fight over QE. This is a perfect example of expensive housekeeping.
In total, the Federal Reserve’s monthly liquidity injections now reach $55.4 billion. This liquidity does not require stimulus measures, but we now know what excess reserves tend to be. They flee, slowly at first, then all at once, as liquidity hell breaks loose.
When this is the case, Bitcoin USD usually comes into play. Reducing financing stress reduces borrowing costs and encourages risk-taking. Even conservative funds begin to be reallocated when liquidity appears plentiful. Federal Reserve liquidity has the power to force capital to move; it is always the same known mechanism.
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The push for another Gold ATH is likely driven by central banks, tariffs, and geopolitical pressure that continues to press on. This year, 755 tonnes of official gold (the amount of gold expected to be purchased by central banks around the world in 2026, predicted by JP Morgan) will be symbolic and strategic.
(source – TradingView)
But, again, as gold blasts ATH after ATH, the narrative coexists with Bitcoin and its strength against the US Dollar. Gold always attracts the first wave of fear-driven capital, and Bitcoin, historically speaking, usually catches the second wave, especially when investors start thinking about mobility, seizure risk, and portability.
A Gold ATH often reflects a distrust of systems and currencies and does not stop at gold vaults. The Federal Reserve’s liquidity only accentuates the contrast by reminding markets how quickly balance sheets can expand again.
Recent on-chain data doesn’t look euphoric, and that’s the point. Liquidations are moderate, but locked DeFi value is increasing. Bitcoin USD dominance still sits near 60%, on solid ground. These conditions arose before the aggressive measures. We know that when the Federal Reserve injects liquidity, volatility remains compressed and pressure builds.
