Bitcoin (BTC) begins November with a drop to $107,000 as traders prepare for a further retest of support.
-
With weekend gains evaporating and downside liquidity increasing, Bitcoin price action is giving bulls a harsh sense of deja vu.
-
Seasonality in November is expected to lead to a significant increase in BTC prices, but there are no signs of easing so far.
-
While expectations for a U.S.-China trade deal are supporting stock prices, cryptocurrencies have been unable to participate as the Fed’s interest rate cuts rise again.
-
Institutional demand has reached a seven-month low compared to the supply of newly mined BTC.
-
Bitcoin retail investors are pulling back as data suggests the $110,000 price may not be sustainable due to reduced network activity.
Bitcoin traders expect trading to be ‘difficult’ this week
Bitcoin fell quickly after the day’s trading, returning to $107,000.
Data from Cointelegraph Markets Pro and TradingView showed that BTC/USD erased its entire weekend gains after traders warned of a “Sunday pump.”
“Honestly, this could be one of the most difficult trading weeks of the fourth quarter,” trader CrypNuevo predicted in the X thread.
“So we think we may be range-bound, so we need to be aware of the possibility of a retest of the range low.”
CrypNuevo noted that these lows have important touch points with the 50-week exponential moving average (EMA) of $101,150, increasing the odds as a downside target. Price revisited this area of Binance when it plummeted from its all-time high of $126,200 in October.
“It’s very solid support, so we’re going to see a very positive rebound from that,” he continued.
Others, including trader Daan Crypto Trades, prioritized liquidity in their exchange order books close to key target prices.
“Two major short-term liquidity levels increased during the weekend range period,” he told X Followers.
“The price has removed the floor that was at $108,000. There is still a decent cluster around $112,000. Zooming out, the $105,000-$106,000 and $117,000 levels are worth looking at.”
Trader and analyst Mark Cullen warned that reduced liquidity could be too tempting.
“Dollar Bitcoin is looking weak, with reduced liquidity having an impact, but could we see one last push before we see a deeper pullback in the coming days and weeks?” he asked about X.
“We’re waiting for America to wake up and see how this week starts.”
Potential for BTC price recovery collapses
While this may traditionally be the start of the best half of the year for stocks, cryptocurrencies have no intention of following suit.
Bitcoin has already fallen 2% in November, further hurting bulls still reeling from its worst October performance since 2018.
CoinGlass data shows just how high the stakes are, with the average November gain since 2013 being more than 40%.
Prediction markets highlight the current low sentiment among crypto market participants. Polymarket has only a 33% chance of BTC/USD ending the month above $120,000 and a 60% chance of $115,000.
Meanwhile, the Crypto Fear & Greed Index remains in “fear” territory, but has not yet reflected Bitcoin’s latest drop to $107,000.
When this level resurfaced last week, research platform Santiment suggested it was key when it came to investors’ price outlook.
“Bitcoin’s drop to $107,000 on Thursday led to a flood of sub-$100,000 BTC price predictions,” he wrote on X at the time, alongside a chart comparing price calls below $100,000 to price calls above $150,000.
“A bailout rally is likely to occur while FUD is at its peak, as it is now, as the market moves in the opposite direction to what the crowd expects.”
Comparison of trade war relief and hawkish Fed
Good news is a priority for stocks this week, as optimism about the U.S.-China trade deal outweighs the risk of a conflict of interest emerging.
S&P 500 futures opened slightly higher as the market digested tariff cuts and the lifting of restrictions on Chinese rare earths and automotive chips.
“This is the biggest détente ever,” trade information site Kobissi Letter wrote in response to the weekend plan.
Despite concerns about US military intervention in both Venezuela and Nigeria, trade remained at the top of the list for risk asset investors. At the same time, it was only cryptocurrencies that felt nervous as the new week began.
Even when the correlation between Bitcoin and stocks collapsed, the situation did not improve. Last week, macro analyst Jordi Visser said that currently only major tech stocks are providing any kind of anchor to Bitcoin’s price movement.
“Bitcoin moves with tech stocks. There is a correlation between liquidity and ‘risk appetite,'” he said in a blog post.
“For years, we were able to predict Bitcoin’s direction by watching the Nasdaq. That correlation has broken down recently, and after December 2024, completely.”
20% of the profits of S&P 500 companies such as AMD and Palantir are expected to be paid out within the next few days.
The ongoing U.S. government shutdown means that only private sector payrolls are unaffected, with precious little inflation data available.
The background to this is increasing uncertainty regarding US economic policy. The Fed has become increasingly hawkish, and further rate cuts in 2025 are now far from guaranteed.
According to data from CME Group’s FedWatch tool, there is a 63% chance of a rate cut at the next FOMC meeting in December.
Trading firm Mosaic Asset Company commented that the Fed’s planned suspension of quantitative tightening (QT) could be a bullish counterweight.
“This has shrunk the Fed’s balance sheet from a peak of nearly $9 trillion in 2022 to $6.5 trillion today,” he said in the latest edition of his regular newsletter, The Market Mosaic.
“The end of QT will eliminate a major source of liquidity drain in financial markets.”
Institutional supply drain reversed
Institutional demand for Bitcoin has come back into focus this week as BTC prices have underperformed relative to stocks and gold.
There were three consecutive days of net outflows from U.S. spot Bitcoin exchange traded funds (ETFs) through October 31, according to data from UK-based investment firm Farside Investors.
The largest of these, BlackRock iShares Bitcoin Trust (IBIT), invested more than $500 million of the total amount.
Currently, these flows are causing concern as institutional demand is not keeping up with the daily increase in BTC supply.
This trend was noted by Charles Edwards, founder of crypto quantitative digital asset fund Capriol Investments.
“For the first time in seven months, net purchases by institutional investors are less than daily mined supply,” he commented on Monday, along with Capriole’s statistics.
Edwards called the findings “not good” and emphasized that the total included ETFs.
The last time institutional demand was not matched by newly mined supply was in early April, just before BTC/USD hit its current local low of around $75,000.
However, as reported by Cointelegraph, Visser sees the ETF’s progress as part of Bitcoin’s long-term maturation as a macro asset class.
“For years, there was no liquidity at all. If you tried to sell $100 million of Bitcoin in 2015, the price would collapse. Try selling $1 billion in 2019. Same problem. The market couldn’t absorb it,” he argued.
“But now? ETFs are doing institutional bidding. Major corporations have Bitcoin on their balance sheets. Sovereign funds are also involved. The market has finally matured to the point where early holders can exit significant positions without causing disruption.”
Bitcoin individual investors “withdraw”
Retail investors have been fleeing Bitcoin since its price fell nearly 20% from its all-time high in October.
Related: Bitcoin could fall 70% as it nears $1 million; MEXC apologizes for “Moby Dick”: Hodler’s Digest, October 26th to November 1st
This is evident from the decline in active BTC addresses, as reported in a study by on-chain analytics platform CryptoQuant.
“At the beginning of November 2024, active addresses were approximately 1.18 million; as of October 30, 2025, there were 872,000, a decrease of 26.1%,” wrote contributor Carmelo Aleman in one of his “Quicktake” blog posts over the weekend.
Aleman directly links recent price movements, which have led to several mass liquidation incidents, to a retail “retrenchment.”
“The absence of retail investors limits visible network activity and delays the natural end of the market cycle,” he concluded.
“Retail provides the emotional impetus and liquidity for strong hands to exit positions profitably, but without it the cycle is longer than usual.”
Fellow contributor Perrin Ai went further, suggesting that the Bitcoin network has strayed too far from price. He said Metcalfe’s Law, which measures a fair price for network propagation, supports that theory.
“Historically, when the NVM ratio exceeds 1, especially when it exceeds 2, prices tend to subsequently decline,” Quicktake’s post explained.
“The current value of 2.97 suggests that the network’s valuation is well above its historical average, indicating that Bitcoin is currently trading in an overvalued zone relative to the size of the network.”
Ai suggested that BTC price could next fall to $98,500 as a result of “saturation” in the Metcalf base.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk and readers should conduct their own research when making decisions.