Crypto Market October Briefing: Breaking through the previous high as scheduled, BTC is likely to fluctuate upwards in the future

! [Crypto Market October Briefing: Breaking through the previous high as scheduled, BTC is likely to fluctuate upwards in the future] (https://cdn-img.panewslab.com/panews/images/3wpL1e47T6.jpg)

The information, views and judgments on markets, projects, currencies and other markets mentioned in this report are for reference only and do not constitute any investment advice.

Macro market

In the golden autumn of October, people who are well versed in the cycle and firmly hold on to it are pleased to usher in a rich harvest!

After a long period of ambiguity and shocks, stimulated by the expectation of spot ETFs, BTC broke out of the shock box that had been suppressed for half a year, returned to the upward channel with a monthly increase of up to 28.54%, and continued the recovery journey.

EMC Labs judged in its September briefing that Q4 multi-forces would push BTC above its previous high of $32,000. Now, this prediction has been fulfilled by the market in the first month. The market movement was unexpected.

However, the global macro financial market is not optimistic. The Nasdaq fell another 3.25% in October, following its biggest monthly decline of the year in September. There was no interest rate hike in November, and there is still suspense about whether it will raise interest rates in December, coupled with the pressure of the U.S. recession, which led to the Nasdaq falling for three consecutive months after the AI hype subsided, and the rebound and rally this year came to an end. The macro financial market has a wait-and-see atmosphere.

! [Crypto Market October Briefing: Breaking through the previous high as scheduled, BTC is likely to fluctuate upwards in the future] (https://cdn-img.panewslab.com/panews/images/2IPwcUz7nV.png)

NASDAQ Monthly Trend

The outlook is uncertain, and the funds on the market choose to enter the “gold” hedge, pushing the price of gold up 8%, approaching a record high.

! [Crypto Market October Briefing: Breaking through the previous high as scheduled, BTC is likely to fluctuate upwards in the future] (https://cdn-img.panewslab.com/panews/images/nuEJiJQ55g.png)

Gold price****daily trend

In contrast, the crypto market, which stopped falling and rose slightly in September, broke through the upper edge of the volatile box that had plagued the market for half a year at $32,000 in one fell swoop, pushing the price to the $35,000 line.

According to the Emergence Engine signal, the recovery period of this cycle began in January and has been running for 10 months so far, with a total of 7 months of growth. In these 7 months, October was the second largest month of the year after January when the Jedi rebounded. The sharp increase in volume shows that the multi-army is determined and full of passion for breaking through the box suppression.

! [Crypto Market October Briefing: Breaking through the previous high as scheduled, BTC is likely to fluctuate upwards in the future] (https://cdn-img.panewslab.com/panews/images/oiEim204Bg.png)

BTC Monthly Trend

Behind the skyrocket, the monthly inflow of $900 million in stablecoins is the direct cause. $900 million is not much, but it is the only positive inflow month this year. It may mean that the attitude of over-the-counter funds is changing.

The market performance of BTC in October fully confirms EMC Labs’ judgment that “with the support of strong on-chain data, the market will rise sharply once the inflow of funds resumes”.

This month, the trend of BTC’s repair period from short to long continues, but there are signs of slowing down as the price of the currency rises. The short-term rally has triggered a wave of sell-offs by long and short hands, and the sell-off has now come to an end. However, the scale of profitability is still huge, which has become a potential energy factor affecting price fluctuations.

The on-chain data deteriorated in October and was repaired after the surge, and the market should continue to be cautious in the future.

Based on multi-dimensional factors, EMC Labs believes that the trend of the repair period continues, and our previous judgment was fulfilled in October, and in November ~ December, the market will fluctuate along the upward channel in the long-short divergence.

Crypto market

In October, BTC opened at $26,961 and closed at $34,656, an increase of 28.54% and an amplitude of 32.03%.

! [Crypto Market October Briefing: Breaking through the previous high as scheduled, BTC is likely to fluctuate upwards in the future] (https://cdn-img.panewslab.com/panews/images/kNq3h1ckly.png)

BTC daily chart

Judging from technical indicators, October is also a full harvest January.

This year, BTC entered the box structure (purple area above) after mid-March, with $25,000 on the lower edge and $32,000 on the top edge. By October 23, when it broke through the upper edge, BTC fluctuated in the box structure for more than 6 months and more than 180 days, during which the upper edge was hit twice in April and July but failed, and the lower edge support continued to be tested in June, August and September. Among them, August ~ September fell below the rising channel since the beginning of the year (blue area in the above chart).

Most of the chips sold during this period came from short-handed whales.

In the September briefing, we pointed out that there is plenty of time for the downward test in August~September. At the end of September, the market began to try to the upside, and in the first half of October, it tested the support again, and finally started a furious upward pattern on the 15th, pushing the price from $26,000 to $35,000 in 11 trading days.

16, 23, 24 several key breakthroughs on the daily average of a large volume, indicating that the long capital art is bold, after eating the Air Force raw, refuse to pull back, but wait for the moving average to move up at a high level, and it is expected that the market will continue to rise after the adjustment.

Funding Supply

Since the beginning of this year, we have observed that the on-chain data continues to improve, just like the firewood stack is getting drier, but the outbreak of the violent upward movement not only depends on the dehydration of the firewood stack (internal causes), but also considers the ignited flame (external causes).

Now, let’s focus on the supply of stablecoins and look at external factors.

! [Crypto Market October Briefing: Breaking through the previous high as scheduled, BTC is likely to fluctuate upwards in the future] (https://cdn-img.panewslab.com/panews/images/e0F0X9Tc2J.png)

Major stablecoin supply

In previous reports, we pointed out that the main buying power of BTC’s rise in the repair period came from the covering of positions in the exchange funds. In fact, behind the 100% surge in BTC this year, the overall capital has been in a state of outflow, with a total outflow of $14.6 billion from the beginning of the year to the end of September.

In the September report, we pointed out that stablecoin outflows are slowing.

In the first half of October, the outflow of stablecoins stagnated, and on the 15th, stablecoins began to show positive inflows, and BTC immediately started to rise.

As of the 30th, the net inflow of stablecoins in October has reached 900 million US dollars!

This is the first time that a stablecoin has achieved a positive monthly inflow this year, marking that the exit of on-exchange funds has been curbed and off-exchange funds have begun to enter the market.

This is the most optimistic external factor that EMC Labs has monitored since the on-chain data came out of the bear market, stablecoins are starting to come out of the bear market.

The net inflow of stablecoins and the start of BTC prices are not bad for a day, which is enough to confirm that the most direct driving force for the sharp rise comes from over-the-counter funds entering the market through stablecoins.

Taking it a step further, we are focusing on USDT and USDC, which have the largest supply.

1.1~10.30——

• USDT: +$18.28 billion;
• USDC: -$19.25 billion.

9.30~10.30——

• USDT: +$1.4 billion;
• USDC: -$100 million.

It can be seen that USDT is in net inflow throughout the year, while USDC is outflowing sharply, and the bleeding will begin to stop in October. Asian funds (as well as Europe and South America), which primarily use USDT, have dominated BTC’s rally this year. This month’s sharp breakthrough is more obvious from the additional issuance of USDT of up to $1.4 billion.

For the study and judgment of the subsequent market, the observation of stablecoins is indispensable.

Entering the first month of Q4, we reaped the first month of net inflows of funds this year. If there are sustained net inflows in November and December, then a market phase known as a “bull market” will be upon us.

Supply Trends

With the sharp rise of BTC in the second half of the month, the profitability of BTC on the chain has been greatly improved. The market-wide MVRV (Uncashed Margin) reached 68%, the Long Lot (LTH) MVRV reached 66%, and the Short Lot (STH) MVRV reached 20%.

! [Crypto Market October Briefing: Breaking through the previous high as scheduled, BTC is likely to fluctuate upwards in the future] (https://cdn-img.panewslab.com/panews/images/bK3jQ9TiBz.png)

Market supply pressures

In the short term, the rapid and sharp rise has increased the supply pressure in the market, especially for short lots, the 20% profit threshold has been reached. A sell-off after satisfaction is inevitable, which may be the reason why BTC is consolidating at $34,000~$35,000.

We take a closer look at the profit/loss profile of selling BTC in both long and short lots.

! [Crypto Market October Briefing: Breaking through the previous high as scheduled, BTC is likely to fluctuate upwards in the future] (https://cdn-img.panewslab.com/panews/images/0mx28Pphcn.png)

The profit and loss of BTC sold

With the rise in the price of BTC, the profit from the sale of both long and short lots has increased significantly, and some of the long lots have gained as much as 61~70% of the profits, while the profits of the short lots have been close to 6%.

In addition to the profit from the sale, we take a closer look at the size of the sale of long and short lots.

! [Crypto Market October Briefing: Breaking through the previous high as scheduled, BTC is likely to fluctuate upwards in the future] (https://cdn-img.panewslab.com/panews/images/oBVxROjXLu.png)

Exchange Balance LTH & STH 2 Exchanges

On the 24th, it was a new high day for the rebound, and it also became the climax of selling long and short lots. On this day, 3,724 long-handed and 45,874 short-handed were sold, both of which were several times the daily sales scale.

The 24th is the third largest selling day for long hands and the eighth largest selling day for short hands so far this year.

This wave of profit-taking sell-off has now come to an end, and the scale of entering the exchange has dropped to about 20,000 per day.

From the perspective of the exchange, as of the 29th, CEX holdings have decreased by 5,000 this month, and there is no greater selling pressure. However, compared with the outflow of 60,000 pieces in September, the outflow this month has decreased significantly.

In addition, the potential return of short lots is still as high as 20%, and there is an urgent need for new short lots to enter the market to reduce the return value. As the market improves, the potential return of short-term lots during the repair period can also rise to 40%, compared with the current 20%.

However, short-term trading is driven by sentiment, and sentiment is mainly affected by external factors, and if the current large-scale sell-off will trigger price phase volatility, it is still necessary to continue to pay attention.

Long and short game

At present, long and short hands still hold huge profits, and the overall profit scale of BTC has approached 15.98 million, accounting for 81.82% of the total supply. In this case, the selling pressure continues to increase, and we need to take a closer look at the size of the long and short lot holdings to assess the true selling pressure.

! [Crypto Market October Briefing: Breaking through the previous high as scheduled, BTC is likely to fluctuate upwards in the future] (https://cdn-img.panewslab.com/panews/images/9n392d83iv.png)

Long-lot, short-lot, central exchange, and miner BTC holding size

10.1~10.30——

• Long hand: +34000
• Short lot: -1000
• CEX：-5000
• Miner：+3000

Long hands and miners continue to accumulate, short hands and CEXs continue to flow out, and although the price has achieved a monthly growth of 28.54%, the trend of “from short to long” continues, which is typical of the recovery period.

Some of the short hands are still flowing out, while the long hands will not see until the higher MVRV values. Although the rate of loss is decreasing, the liquidity of the market is still decreasing, while purchasing power is recovering. Overall, medium-term liquidity is sound.

In previous monthly reports, we continued to track the short-handed whale population. In the past 6 months of correction, they have dominated the market volatility for a time.

! [Crypto Market October Briefing: Breaking through the previous high as scheduled, BTC is likely to fluctuate upwards in the future] (https://cdn-img.panewslab.com/panews/images/OPMw4UxEnP.png)

In October, this group continued to reduce their holdings to cash in profits. The 310,000 that have been added to the bottom zone have been sold out, and now they are still selling inventory, with a net sale of 110,000 in October.

In the context of net inflows, its selling behavior has been unable to have an impact on the market. However, it still holds more than 6 million BTC, which is still a selling force that should not be underestimated, especially when the market is weak, which is expected to have a more obvious impact on the medium and short term.

On-chain data

From late September to mid-October, the uncertain outlook and market downturn led to a severe decline in new address data. After the rebound, the number of new addresses on the chain has risen rapidly driven by speculation.

! [Crypto Market October Briefing: Breaking through the previous high as scheduled, BTC is likely to fluctuate upwards in the future] (https://cdn-img.panewslab.com/panews/images/322fBWVww1.png)

BTC daily new address

Similar changes have been observed in terms of active entity and daily transfer data.

! [Crypto Market October Briefing: Breaking through the previous high as scheduled, BTC is likely to fluctuate upwards in the future] (https://cdn-img.panewslab.com/panews/images/76B99Pd515.png)

BitNetworks is a daily active entity

! [Crypto Market October Briefing: Breaking through the previous high as scheduled, BTC is likely to fluctuate upwards in the future] (https://cdn-img.panewslab.com/panews/images/yVi7jV797V.png)

The daily transfer scale of the bit network

It is important to note that with the rise of Ordinals, the data structure of the bit network has changed, and the recent ebb and flow of on-chain activity is also related to the fading of the speculative frenzy of Ordinals-based NTF and BRC-20 meme coins.

In addition to these, on-chain activity is an important influencing factor for the price of the currency, which is worth tracking for a long time and in depth. The trend of the medium and long-term currency price cannot deviate from the on-chain activities.

Conclusion

In the September briefing, EMC Labs judged: “There is a high probability that the long-term forces in Q4 will actively take action to push the market to challenge the year’s high of $32,000 again, and there is a high probability that it will historically break through the upper edge of the box that has besieged BTC for half a year, ending the recovery period although it is a bumpy but not easy year.” ”。

October is coming to an end, and the forecast has been fulfilled for the market.

For the trend of the market outlook, based on on-chain supply, on-chain activities and technical indicators, EMC Labs believes that after the surge, the loose chips in the hands of the current long and short have realized profits, and the repair trend of “from short to long” is still continuing. The trend of the repair period continues, and in November ~ December, the market will fluctuate upward along the rising channel in the divergence between long and short.

The return to the box, that is, below $32,000, is an ultra-low probability event. If it happens, it will bring an excellent opportunity for margin call.

INTERNAL FACTORS TO FOCUS ON INCLUDE THE REPAIR OF ON-CHAIN DATA, THE BTC-ALTCOIN ROTATION, AND THE SELLING OF SHORT-HANDED WHALES, WHILE EXTERNAL FACTORS INCLUDE NET INFLOWS, NASDAQ TRENDS, AND THE POSSIBILITY OF A RECESSION. On the contrary, the impact of the US dollar rate hike is likely to be the weakest, and if the rate hike is raised again in December, the market will most likely see the boot on the ground.