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Uptober has come to an end, but the market failed to deliver.
From a technical perspective, nearly $300 billion was wiped off the crypto market cap in October. The market saw its first monthly loss in 4 months. The result? Large-cap assets were hit by selling pressure, including Bitcoin seeing a 7.3% correction.
However, $BTC ended its second back-to-back negative month in October, a rare streak not seen in over a decade.
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The liquidation data tells the story. Across the top seven exchanges, the crypto market saw $4.2 billion in long liquidations against $1.9 billion in short liquidations, bringing the total above $6 billion.
This is up by 600%+ from September, pointing to a massive leverage flush and a sharp reset in bullish positioning.
However, zoom in, and the picture starts to change.
Although Bitcoin took a 7.3% hit, it was still faring much better than other risky assets. Ethereum dropped 16.3%, more than 2x $BTC’s decline. Even major companies like Meta have corrected 15%, and Nvidia has taken a serious hit of over 10% during the same period.
This puts $BTC’s relative strength into focus, suggesting capital may be rotating towards Bitcoin as broader risk appetite weakens.
If this setup holds, a massive bear trap could be brewing.
On-chain data shows that there is $15 billion in $BTC shorts stacked above $85k compared to only $2.5 billion in longs. That’s a 6x imbalance, suggesting significantly more liquidity sits on the upside.
So, if Bitcoin [$BTC] starts to re-test key levels, could a wave of shorts liquidations trigger a broader “Moonvember” rally?
Despite the general risk-off sentiment, risk appetite is relatively strong and has been further supported by Bitcoin’s outperformance against other risk assets. Matt Mena, Senior Crypto Research Strategist at 21Shares, also echoed this view.
With PCE in-line with expectations and $BTC holding the $80k support, the market has room to recover. A break above $82k could open the door toward $85k and eventually $90k. Hyperliquid’s HYPE is gaining momentum following the ICE and Trade.xyz partnership. With U.S. midterm uncertainty fading, and November historically delivering strong $BTC returns (36.6% on average), the market could see $BTC make a final run to $90k+ by the end of the year.
Interestingly, the chart below highlights this divergence. Despite the risk-off Uptober, Bitcoin dominance increased by 2% to 60.9%. This shows that capital continues to flow into Bitcoin, even as broader U.S. markets face selling pressure.
This highlights $BTC’s growing appeal as a macro hedge amid market FUD.
Against this backdrop, the $300 billion crypto wipeout and $6 billion in liquidations, including $4 billion in longs, suggest a major leverage reset. As Uptober unwinds some of this overflow, the bulls could be setting a massive bear trap ahead of a potential Moonvember rally.
Bitcoin outperformed Ethereum and major stocks, while dominance climbed to 60.9%.
Over $6 billion in liquidations cleared leverage, while $15 billion in shorts could fuel a Bitcoin rally.
