The Liquidity Flip

Why the Biggest Obstacle to the Market Is About to Disappear

Author

Saâd Dhif
November 20, 2025

Zooming Out

This week's outlook could mark a turning point for crypto, tech, and macro investors alike.

Below is your essential breakdown of what’s happening with the Fed, and why it’s the most bullish structural signal since the beginning of this cycle.

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The Fed Just Quietly Removed the Market’s Biggest Headwind

After draining over $1.4 trillion from the financial system through Quantitative Tightening (QT), the Federal Reserve is reversing course.

Starting December 1st, the Fed will stop shrinking its balance sheet. Instead of letting Treasury bonds and MBS securities roll off, it will begin reinvesting them, injecting liquidity back into the system.

Let that sink in.

For nearly three years, the market has rallied against the tide of monetary tightening.

Now, that tide is turning.

And when liquidity shifts, everything changes.

Why This Matters: Liquidity Drives Risk Assets

When the Fed ends QT:

  • 💸 More cash flows back into the system

  • 🧠 Investor confidence increases

  • 📈 Risk assets - from tech stocks to crypto - tend to outperform

In fact, the last time QT was paused (2019), markets surged. And back then, we didn’t have:

  • 🔺 Interest rates this high

  • 💰 Balance sheets this inflated

  • 🚀 Mega-cap tech powered by AI spending

  • 🧠 Public-private partnerships investing billions in infrastructure

This time, the impact could be even more explosive.

QT is Over. What Comes Next?

Let’s rewind:

  • In 2022, the Fed began letting billions in Treasuries expire each month without reinvestment.

  • That quietly drained liquidity from the system and tightened credit conditions behind the scenes.

  • ~$95B/month was removed from markets, dampening flows into stocks, crypto, and growth assets.

That quiet pressure is now gone.

Even though this isn’t full-blown QE yet, it’s the closest thing to a “stealth pivot” we’ve seen.

Markets thrive on liquidity.
When that liquidity expands, capital floods back into the highest-beta sectors first — think AI, crypto, semiconductors, and cloud infrastructure.

Tech and Crypto: First to Benefit

Look at the chart below:

NASDAQ (Bloomberg)

Since the end of 2022, Nasdaq has massively outperformed the broader market.

  • This isn’t just AI hype.

  • It’s structural leadership powered by liquidity preference.

When money needs a home, it looks for:

  • High innovation

  • High margins

  • Strong balance sheets

  • Optionality for growth

That’s exactly what mega-cap tech and high-quality crypto projects offer.

And with the Fed now stepping back from QT, the environment just flipped from neutral to supportive.

Crypto Markets: Liquidity Is King

For crypto, the impact is even more pronounced.

  • Crypto is the most liquidity-sensitive asset class in the world.

  • Every previous bull run has coincided with easing financial conditions.

Now that the Fed is reinjecting capital and rate cuts are expected in early 2026, the macro backdrop becomes net positive for the first time in over a year.

It’s not just narrative anymore: the liquidity mechanics are actually shifting.

But Volatility Isn’t Going Anywhere

Don’t confuse liquidity with serenity.

  • We'll still see volatility

  • We'll still get shakeouts

  • Headlines will still cause temporary fear

But now the dominant structural force is no longer a headwind: it's a tailwind.

That changes how you position:

  • No need to chase.

  • No need to panic.

  • Just prepare intelligently.

Positioning for This New Phase

Here’s how we’re playing it at Swiss Islamic Finance:

  1. Keep core positions in ETH, SOL, BTC intact

  2. Build conviction in crypto-aligned infra plays (DePIN, L2s, AI tokens)

  3. Use volatility to add, not to panic

  4. Avoid leverage, as always

  5. Stay updated with our full Altseason Playbook and Crypto Liquidity Rotation Models inside our private Skool community.

CTA: The Rotation Is Beginning. Don’t Miss It.

The Fed pivot is real.
Liquidity is back.
And those who understand the structure will be positioned long before the crowd catches on.

If you want full weekly market updates, trade plans, and halal-aligned crypto strategy…

👉 Join the Swiss Islamic Finance Skool Community Today
We provide the insights, tools, and conviction to stay ahead of the next rotation.

Stay strategic. Stay grounded. Stay halal.
Believe or not, next phase is here.

—
Saâd
from Swiss Islamic Finance

Invite Your Friends

If you enjoyed this issue, forward it to someone who’s asking if “Bitcoin is halal”, they’ll thank you later: