Market Wrap: Bitcoin Rangebound as Traders Expect Strong November

Bitcoin has traded in a tight range over the past few days. It appears that extreme bullish sentiment is starting to cool after BTC reached its all-time high of around $66,900 two weeks ago. For now, traders are gearing up for a strong November and expect positive crypto returns heading into the end of the year.

Still, some analysts see room for a slight pullback as open interest rises in the bitcoin futures market. “[Rising open interest] is typically a bearish signal as it means there is more leverage in the system – this increases the chance of a liquidation event where traders are forced to sell and the price cascades lower,” Marcus Sotiriou, a sales trader at U.K.-based digital asset broker GlobalBlock, wrote in an email to CoinDesk.

“Aside from open interest, the euphoria seen from the rise in meme coins last week, notably SHIB, could contribute to a leverage flush in the short term, due to the increase in retail traders,” Sotiriou wrote.

In observance of the U.S. Election Day, a CoinDesk company holiday, Market Wrap will not be published on Tuesday.

Bitcoin tends to gain 11%-18% in the fourth quarter, which is one reason why some analysts have maintained their bullish outlook on crypto prices for the remainder of the year. It appears that BTC has followed a seasonal pattern with a sell-off earlier this year and a volatile September, although the downside was limited as traders entered to buy on dips.

Despite wild price swings, bitcoin’s long-term uptrend remains intact. And generally, analysts view cryptocurrencies as an early-stage investment. “Crypto is still under-owned and there is still a large knowledge gap,” but the industry is rapidly gaining traction among professional investors, crypto trading firm QCP Capital wrote in a Telegram chat.

Here is another interesting stat for traders. CoinDesk Research analyzed bitcoin’s average daily returns since 2010 and found that Tuesday is the most bullish day of the week, followed by Wednesday.

Digital asset investment products saw a total of $288 million in inflows during the week ended last Friday, a report Monday by CoinShares showed. That’s down from a record $1.47 billion during the prior week, but it helped to push inflows to $8.7 billion year to date.

As in the previous week, the majority of new investments went into bitcoin-related funds, at about $269 million.

The decrease in flows coincided with a market pause as bitcoin (BTC) hit its all-time high of $66,974 on Oct. 20 but retreated last week.

Popular meme tokens saw large gains in October as cryptocurrency market sentiment improved, CoinDesk’s Lyllah Ledesma reported. The dog-themed coin SHIB’s 765% gain in October made it the month’s top-performing cryptocurrency among those with a reported market capitalization of at least $10 billion.

And last Thursday, dogecoin reached its highest level since Aug. 20, trading near $0.30. It finished the month with a market cap of $36 billion.

Within the CoinDesk 20, a group of 20 curated digital assets, the top performing coins in October were Polygyon’s MATIC, which climbed 56%; Polkadot’s DOT, up 36%; and Ethereum’s ether (ETH), which rose by 30%.

Most digital assets in the CoinDesk 20 ended the day higher.

Notable winners as of 21:00 UTC (4:00 p.m. ET):

Notable losers: