China to Set New Growth Target: What It May Mean for Global Markets, Liquidity, and the Crypto Sector

China is expected to announce a new growth target during the National People's Congress next week. Recently, China's Purchasing Managers' Index (PMI) showed a strong reading of 52.6, indicating the second consecutive month of economic growth. Additionally, China experienced growth in home sales for the first time in 20 months and export orders for the first time in nearly two years.

The data set suggests that China's economy is recovering from the impact of the COVID-19 pandemic, and this could have implications for global financial markets and the flow of liquidity.

Firstly, positive economic data from China could boost investor confidence in the country's economic recovery, leading to increased investment flows into China's equity and bond markets. This could potentially drive up asset prices in these markets, which could spill over into other global markets.

Secondly, increased economic activity in China could lead to higher demand for commodities, such as iron ore, copper, and oil, which are key inputs in China's manufacturing sector. This could benefit commodity-exporting countries, such as Australia, Brazil, and Saudi Arabia, as well as companies involved in the production and transportation of these commodities.

Thirdly, the flow of liquidity could also be affected by the Chinese government's response to the economic recovery. If China maintains an accommodative monetary policy stance, this could provide a supportive backdrop for global liquidity and asset prices.

Turning to the crypto sector, per Tradingview data, the current market cap is approximately $1.033T. Yesterday, the market's upward trend hit a roadblock at $1.04T, which corresponded with a surge in trading volume based on the volume profile indicator. Moving forward, if the market closes below the $1.028T benchmark, it is expected to target $1.018T in the short term, indicating further declines or consolidations for many coins. Conversely, if the market manages to close above the $1.037T Fib Extended Golden Zone, yesterday's bullish candle may indicate a turnaround for the entire sector, with more capital flowing into the cryptocurrency market and resulting in a rise in most coins.