The crypto market lost 2% to $2.74T; a drop below $2.7T would end the consolidation. Bitcoin fell to $81.7K, Ethereum failed at $2.5K; ETF inflows and seasonality still support the bulls.
Market Overview
The crypto market capitalisation has fallen by 2% over the past 24 hours to $2.74T. Selling pressure intensified after the market reached a 10-day high, pushing it back into its previous trading range. The pressure from sellers is raising questions about the nearest support levels. A fall below $2.7T would signal a breakout from the consolidation phase and could trigger an avalanche of stop-loss orders, exacerbating the decline. This would be an unexpected turn of events, given the positive seasonal trends and the market optimism that has built up over recent months.
On Wednesday, Bitcoin soared above $84.5K to a two-week high on the back of positive stock market momentum, but failed to sustain the rally and, by midday on Thursday, had erased Tuesday and Wednesday’s gains, retreating to $81.7K. This return to the 50-day moving average means the bulls cannot celebrate a quick victory. The price was unable to break away from this curve mid-year, spending about 40 days in a narrow range. The sell-off has been triggered by external factors, so the situation's further development may also be dictated by external events. It is interesting to note how synchronised the decline in gold and Bitcoin was on Thursday.
Fig. 1. Bitcoin failed to capitalise on the bullish sentiment.
Ethereum failed to break through the $2.5K resistance and return to the area above the 50-day moving average, which had acted as local resistance for the second time in October. This is a worrying sign for cryptocurrencies, as ETH often serves as a leading indicator of demand relative to BTC or the market as a whole. The next support levels to watch are $2.3K (the low of the range since August and the March–April highs) and $2.15K (the 200-day MA).
Fig. 2. Ethereum hit the 50-day moving average for the second time in October.
News Background
Inflows into US spot Bitcoin ETFs at the start of the week surged to their highest levels in nearly a month, more than offsetting half of the outflows seen over the previous two weeks.
The next six weeks are historically the best time of year for Bitcoin, according to investor Fred Krueger.
Meanwhile, spot XRP ETFs in the US recorded weekly capital outflows for the first time in three months. Although the outflow was modest, a sharp decline in on-chain activity on the XRP Ledger has heightened caution amongst market participants.
Stablecoin reserves on Binance have fallen to a one-year low, notes analyst Darkfost. As a result, the market lacks fresh liquidity to purchase cryptocurrencies.
The German Savings Banks Association (DSGV) has begun to gradually roll out crypto trading for retail customers. Initially, users will be offered Bitcoin, Ethereum, XRP, Solana and Polygon.
The US authorities have approved final rules for issuers of payment stablecoins under the GENIUS Act. The document sets out requirements for reserves, token redemption, risk management, auditing and asset custody. The issue of user rewards for transactions involving stablecoins remains unclear.
The FxPro Analyst Team