After ‘Uptober’ plays out, what could we see in November?

This is a segment from the Forward Guidance newsletter. To read full editions, subscribe.

The historic trend of BTC rising in October ended up occurring again despite a rocky first half of the month and a rough final day. All said and done, the asset’s price rose nearly 11% during the month.

BTC started October around the $64,000 mark and breached $66,000 a couple weeks in before breaching $73,000 earlier this week. Some attributed the run to heavy bitcoin ETF inflows and a possible Donald Trump victory as some polls (and betting markets) swung in his favor.

On Halloween though, bitcoin dipped a few percentage points, trading between $69,000 and $70,000 for much of the day. 

Historically, positive returns have been a bit more of a toss-up during the year’s 11th month, with four of the last six Novembers in the red, Coinglass data shows. 

Still, November has the highest average monthly return for BTC — thanks to 449% growth during the month in 2013. The cryptocurrency also notched returns of 53% and 43% in November 2017 and November 2020, respectively.  

The macroeconomic context globally is one of central banks turning toward monetary loosening, noted OTC Capital CEO Brian Dixon — a favorable backdrop for BTC.

“A lot of the upwards price action seems to have been front-run earlier this year because of the approval and launch of the bitcoin ETFs, and this was followed by months and months of sideways action,” Dixon told Blockworks. “Now, however, after a period of prolonged consolidation, I believe we may appear to be headed toward a major and sustained breakout.”

But a potential recession — should the Fed be unable to achieve a soft landing — could disrupt the upward trend bitcoin has generally maintained since early 2023, according to YouHodler chief of markets Ruslan Lienkha. 

“The psychological level of around $80,000 may act as a point where investors start to take profits, potentially introducing some selling pressure,” he added.

Demand for bitcoin ETFs was ample in October, with inflows totaling $5.4 billion during the month. This was a substantial jump from September, during which nearly $1.3 billion worth of assets entered the fund segment. 

Overall, October marked the second-best flow month for the category — falling shy of the nearly $6.1 billion seen in February.

MonthNet Flows (millions $)January+1,460February+6,063March+4,637April-345May+2,073June+667July+3,169August-92September +1,263October+5,415

You already know about some of the possible US election implications on the crypto market, and we’ll talk more about that on Monday. But maybe it’s best not to think about that all weekend.

Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the Forward Guidance newsletter.

Get alpha directly in your inbox with the 0xResearch newsletter — market highlights, charts, degen trade ideas, governance updates, and more.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.