The crypto market is attempting to break through its local bottom

Market overview

The crypto market cap has fallen by 7.7% over the last seven days to $3.6 trillion. The market's return to Thursday's local lows indicates that the bulls lack significant strength, which may encourage the bears at the start of the week. Cap has now fallen back to its 200-day moving average. Its last touch at the end of June triggered a growth impulse, pushing it to new highs. However, we are now more inclined to see a repeat of the spring scenario with a decline below this level, possibly by 15-20%.

Bitcoin started the week and month with another attempt to dip below the 200-day moving average, falling back to $107K. The ongoing testing of support since the second half of October is a significant reason for our caution regarding the market in the near term. The most pessimistic scenario would be realised in the event of simultaneous pressure on the stock markets and a strengthening of the dollar. But optimists may also note the sequence of higher lows at the peaks of the sell-off.

Bitcoin fell 4.5% in October to $109.5K, defying the seasonal trends of one of the best months of the year. BTC failed to grow this month for the first time since 2018. From a seasonal perspective, November is considered a relatively bullish month for BTC. Over the past 14 years, Bitcoin has ended this month with growth in nine out of 12 cases. The average increase was 24%, and the average decline was 16.8%.

News background

During the month, $0.57 billion (+4.1%) was invested in spot Ethereum ETFs in the US, but ETH fell 8% in October.

The inflow into the newly launched Solana ETFs in the US continued for four consecutive days. According to SoSoValue, the net inflow into SOL ETFs amounted to $199.2 million for the week. There are only two players in the segment so far — the new BSOL from Bitwise and the converted GSOL from Grayscale.

Technical analyst Peter Brandt has opened sales on Bitcoin futures. In his opinion, a ‘megaphone’ pattern has formed on the BTC chart, which usually heralds a price drop.

Bitcoin is expected to continue experiencing cyclical fluctuations, and over the next two years, its price could decline by 65–70%, according to Sigma Capital. However, in 10 years, the value of digital gold is expected to exceed $1 million.

Long-term XRP holders have been increasing their sales of the token in recent months. Since the beginning of August, the daily sales volume of XRP by hodlers has grown by 580% to $260 million, according to Glassnode. A similar trend can be observed among short-term holders. At the same time, large addresses have begun to accumulate the asset.

Tether has made more than $10 billion in profits since the beginning of the year, the company said. Investments in US Treasury bonds reached a historic high of $135 billion.