The crypto market is down today, with the cryptocurrency market capitalization rising by 0.8%, now standing at $4.23 trillion. 75 of the top 100 coins have dropped over the past 24 hours. At the same time, the total crypto trading volume is at $206 billion, higher than the previous few days.
At the time of writing, 9 of the top 10 coins per market capitalization have seen their prices decrease over the past 24 hours.
Bitcoin (BTC) fell by 0.5%, currently trading at $121,142. It’s the second-smallest drop in the category.
Sean Dawson, head of research at the onchain options platform Derive.xyz, argues that “Bitcoin volatility is poised for a breakout.”
He explained that implied volatilities across 14-, 30-, and 90-day expiries have surged to their highest levels in 30 days. The spike follows the market pricing in a 25 basis point rate cut by the US Federal Reserve expected later this month.
This suggests “increased anticipation of big moves ahead.”
Term structure of BTC volatility with box plots overlaid to highlight historical ranges:
Furthermore, there is a dense band of short positions at risk of liquidation just above the $121,600 level. “A modest push upward could trigger a cascade of liquidations and propel BTC back toward $125,000 and beyond,” Dawson says. “On Derive, traders are positioning for a significant upside move,” he adds.
According to Gadi Chait, Head of Investment at Xapo Bank, as we progress through Uptober, “it will be interesting to see if we make any meaningful move higher. Fed policy developments at the October 28-29 FOMC meeting may be a catalyst for a move that can either extend the rally, or trigger healthy consolidation.”
Additionally, Ruslan Lienkha, chief of markets at YouHodler, commented that “the lack of new catalysts is one of the key reasons for crypto’s current stagnation,” he says. “Earlier cycles were fueled by innovations such as the rise of DeFi and NFTs, as well as institutional adoption, which attracted new capital inflows and speculative enthusiasm. At present, the market lacks comparable internal drivers. Regulatory uncertainties, subdued retail interest, and a lack of major new technological narratives have contributed to the muted price action.”
Lienkha continues: “This period of consolidation also suggests that investors are hesitant to commit new capital to high-volatility assets while equity valuations remain inflated. Many institutional participants are maintaining exposure but avoiding significant portfolio expansion. The market’s posture is one of patience rather than conviction.”
At the time of writing on Friday morning, BTC trades at $121,142. Earlier in the day, the price dropped from the intraday high of $123,548 to the low of $119,967, before recovering to the current price.
It’s down 3.9% from its all-time high of $126,080. At the same time, it’s up 1% in a week and 8.3% in a month.
Investors are now looking to see if BTC will move above $124,000 again and towards $126,500, or it will drop below $119,500, which would open doors for the $117,000 level.
Ethereum is currently trading at $4,332. It initially dropped from the day’s high of $4,434 to $4,331. Then, after a brief jump, the price plummeted to the intraday low of $4,285. It has recovered since,
ETH is now 12.5% away from its ATH of $4,946. It’s also down 3.2% in a week and up 0.2% in a month, meaning it’s unchanged in the latter timeframe.
The coin faced resistance at $4,750, and should it convincingly break through it, the price could surpass the $5,000 mark. If it drops below $4,200, it may proceed to a fall below $4,000.
Meanwhile, the crypto market sentiment had dropped again. The crypto fear and greed index fell from 55 yesterday to 54 today.
Investors seem to be still optimistic, but caution is growing. Incoming factors, both geopolitical and economic, are likely to influence the overall market direction.
Moreover, the US ETH ETFs broke the 8-day streak of inflows on 9 October with $8.54 million in outflows. The cumulative total net inflow is now at $15.08 billion.
One of the nine finds saw positive flows, and five saw negative flows. BlackRock took in $32.29 million, while Fidelity let go of $30.26 million.
The crypto market has decreased over the past day, and the stock market pulled back on Thursday after the latest all-time highs. By the closing time on 9 October, the S&P 500 was down by 0.28%, the Nasdaq-100 decreased by 0.15%, and the Dow Jones Industrial Average fell by 0.52%.
Pullbacks are normal after a rally and no reason to panic. The market seems to be in a consolidation phase now, which could be healthy for it as it prepares for the next run.
