Bitcoin Faces Challenges in November Following Tough October
Bitcoin entered November facing some pressure, having just experienced its most challenging October in ten years. The cryptocurrency dropped below $105,000 early on Tuesday as significant players intensified their selling following the Federal Reserve’s recent decision.
Over the past 24 hours, BTC has decreased by 2.8%. Ethereum saw a more considerable decline of 6%, trading around $3,630. Solana was the hardest hit, plummeting 10% to under $160, marking a seven-day drop of over 20%. BNB declined by 6.4%, and XRP fell by 5%. Cardano’s ADA also saw a similar decrease of about 6%.
This widespread downturn has led to a $100 billion reduction in the cryptocurrency market’s capitalization, which now sits at approximately $3.6 trillion.
Alex Kupczykevich, a chief market analyst at FxPro, commented, “The crypto market is on the brink of breaking out of its depths. Bitcoin’s repeated testing of the 200-day moving average indicates that support is fragile, and further retracement is possible. However, if the structure resembles April’s trend, there could soon be some buying momentum.”
October’s 4.5% decrease interrupted Bitcoin’s lengthy streak of gains, signaling a return to cautious macro conditions. Although the recent 25 basis point rate cut by the Federal Reserve was anticipated, Chairman Powell’s restrained comments hinting that a December cut isn’t assured dampened risk-taking.
Rachel Lin, CEO of SynFutures, shared her thoughts: “The first Red October for Bitcoin in seven years certainly attracted attention, but I see it more as a healthy reset rather than a fundamental reversal. This pullback seems like consolidation within a larger upward trend, and long-term holders continue to accumulate while ETF flows remain stable.”
A $29.4 billion repo operation on Monday, the largest since 2020, provided short-term liquidity to the U.S. banking system, aiding in the stabilization of investor sentiment. This wasn’t a return to quantitative easing, but it showed that policymakers are attentive to liquidity issues.
Historically, November has been a strong month for Bitcoin, with gains in nine out of the past twelve years. Whether this trend will continue hinges on traders quickly regaining confidence and if the Fed’s “soft pivot” narrative can attract new investment into cryptocurrencies.
The recent downturn reflects broader risk aversion in stocks and commodities as investors reassess the Fed’s cautious messaging alongside ongoing geopolitical uncertainties.
On Tuesday, S&P 500 index futures fell, and gold retracted from its recent peak near $4,400, losing ground established during last month’s haven-driven rally. Meanwhile, U.S. Treasury yields stabilized after a brief dip caused by the Fed’s liquidity measures.
A thin order backlog over the weekend and a swift unwinding of leveraged long positions exacerbated the downside moves, resulting in over $1.2 billion liquidated in just 48 hours. Although funding rates have normalized, market positioning remains cautious.
