In brief
- Bitcoin’s recent drop is a mid-cycle reset, not a bear trend, according to analysts.
- The crypto’s first red October in six years could be setting the stage for a bullish comeback in November.
- A cooling trade war could serve as a tailwind, though macroeconomic concerns persist.
Bitcoin is heading into November after its first negative October performance in six years, leaving investors wondering if the historic downturn signals a deeper bear trend or a healthy reset before the next leg up.
Bitcoin is down 1.4% over 24 hours and trading around $107,000, contributing to a 2.2% drop in the total crypto market cap to $3.64 trillion, per CoinGecko data.
The sell-off triggered over $1.16 billion in long liquidations on November 3, underscoring the intensity of the recent leverage unwind.
The road so far
The month’s “Red October” occurred against a complex macroeconomic backdrop, including Federal Reserve Chair Powell’s announcement of the end of quantitative tightening and rate cuts, followed by comments that tempered expectations for a December rate cut.
The uncertainty around macroeconomic policy has pressured risk assets, with Bitcoin’s U.S.-session returns cooling significantly from 0.94% on October 29 to -4.56% over the past week, according to Velo data.
Geopolitical tensions have notably eased following the Trump-Xi agreement that de-escalated the trade war. The temporary pause averts threatened 100% tariffs and extends a delicate truce between the world’s two largest economies.
What’s next?
“So could this red October actually set up the next major leg of Bitcoin’s bull cycle? I think that’s entirely possible,” Rachel Lin, CEO of SynFutures, told Decrypt. “Corrections like this tend to be the midpoint of a broader cycle rather than the end.”
Historical data support the optimistic interpretation, with Bitcoin’s mean return for the third quarter remaining positive at 6.05%.
It’s also worth noting that November has historically been one of Bitcoin’s strongest months, posting a mean return of 42% over the past 12 years.
“For November, I expect a period of stabilization and cautious optimism,” Lin said. “Bitcoin may trade sideways early in the month as markets absorb Fed commentary, but a decisive shift in tone could trigger a recovery.”
The expert maintains that if Bitcoin continues following its typical post-halving pattern, “a move toward $120,000 to $150,000 by the end of 2025 remains within reach,” citing strong underlying fundamentals from ETF flows to institutional custody solutions.
Bitcoin is likely to continue a “range-higher” trajectory, Decrypt was previously told. The bullish case is also supported by strong on-chain data showing that long-term structural demand remains intact despite short-term weakness.
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