Uptober unravels for Bitcoin as institutional demand cools and whale sells

Bitcoin is falling below 108k, sharply reversing after the weekend’s rebound and recovery to 111k ran out of steam. Major altcoins are also trading lower, with Ethereum falling 3% to 3865 and XRP dropping 4.5% to 240. The total cryptocurrency market capitalisation has fallen 3% over the past 24 hours to $3.65 trillion. 

With just 10 days to go until the end of the month, BTC trades 5% lower across October, as Uptober’s bullish reputation fails to hold up. Not only has Bitcoin failed to correlate as a store of value with safe-haven Gold, which is up 10% month to date. It has also broken down its correlation with risk assets such as the Nasdaq, which trades + 1.4% so far in October. The BTC Nasdaq correlation coefficient is just 0.20, after dipping into negative territory in late September, indicating a weak correlation at best. 

Highlighting the diverging correlation, Bitcoin is falling even as broader risk sentiment has improved due to Japanese political developments and easing US-China trade concerns. The US government shutdown has entered its third week, with the Senate vote failing again. However, economic advisor to the White House Kevin Hassett said that the shutdown would likely end this week. 

Institutional demand falls 

Bitcoin institutional demand fell at the start of the week, with BTC ETFs recording $40.47 million in outflows on Monday, marking a fourth straight day of outflows. This comes after BTC ETFs recorded outflows of $1.23 billion in the last week, the second-largest weekly net outflow since launch, indicating caution from institutional investors.  

However, ETFs have seen net inflows across October, and a new Coinbase survey revealed that institutions remain optimistic about Bitcoin’s trajectory, with nearly 67% expecting BTC’s price to climb across 2026. However, in the near term, the picture is less clear with opinions divided on where the market stands right now. The mood has turned more cautious after the recent bout of volatility. 

Trump insider whale adds to short position. 

The whale, known as the “Trump insider” partly responsible for some of that volatility, sending the market sharply lower on October 10, is on the move again. The so-called “Trump insider” whale has again taken a bearish position.  

According to Onchain Lens, the address added a 200 BTC short position worth $22 million with 10x leverage to its existing bet against the market. The trader now has 900 BTC in short positions valued at $99.6 million. The moves have drawn attention, with many market participants speculating whether the whale is positioning for another market correction, remembering that the wallet first gained fame after reportedly earning $160 million by shorting BTC before Trump’s tariff announcement triggered a selloff.  

It remains unclear whether this bearish bet will be profitable or not, but whale moves can influence the market by exerting selling pressure, hurting sentiment, or both. 

Looking ahead 

Looking ahead, Friday's US CPI data could be a key driver ahead of next week’s FOMC rate decision, in which the Fed is expected to cut rates by 25 bps. Cooler inflation or a dovish-sounding Fed could lift BTC. 

BTC technical analysis  

After recovering from the 200 SMA support, BTC rose to 111.7k. However, it faced rejection at the multi-month rising trendline, sending the price lower once more to test the 200 SMA. 

Sellers, supported by the RSI below 50, will need to break below the 200 SMA at 108k and the September low for bears to gain control and bring 101k, the 50% Fib retracement of the 74.6k low and 126.4k high, as well as 100k, the psychological level, into focus. 

Should the 200 SMA hold, buyers will need to rise above the rising trendline at 111k to bring 114.5k into focus - the 50 SMA and the 23.6% Fib retracement level. A rise above here creates a higher high, bringing 120k into play. 

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