Trading Desk Insights
Bitcoin slipped under 95k on Friday, extending a four-day slide that’s been tied up with a broader pullback in tech equities. What was supposed to be a year-end squeeze higher instead turned into a positioning flush. Too many traders leaning long, not enough fresh buyers. The seasonal October tailwind didn’t stick, and with the calendar winding down, long-term holders are locking in gains, cleaning up balance sheets, and heading into year-end lighter. Add in a few Fed Governors pushing back on rate-cut optimism, and it’s not hard to imagine a bit more downside before the market stabilizes.
The government shutdown finally ended Wednesday night after more than six weeks, the longest on record. That was supposed to be a relief valve for investors waiting on key data, but the aftermath is messy. The White House said some missed reports might never be published, which muddies the Fed’s visibility. Ironically, that could make policymakers more cautious about cutting rates. The Treasury General Account (TGA) drain kicks off today, which historically leads Bitcoin by about a week. Back in 2019, BTC bottomed roughly 12 days after the shutdown ended as liquidity normalized. The reopening this time is expected to release around $150B of excess liquidity into the system, which could offer a near-term tailwind once that cash starts moving.
Macro tone remains heavy. Futures are leaning lower after the worst day for Wall Street in more than a month. Rate-cut odds for December have faded fast, down to roughly 50% from 67% a week ago and 94% a month back. Traders are starting to think the Fed might stay put a little longer if data stays firm. Gold ripped toward 4,250 before stalling at the 61.8% Fibonacci level, a familiar resistance zone that’s cooled some momentum. Nvidia’s earnings next week now loom as the next major test for risk sentiment across markets.
Flows tell the story in crypto ETFs. Bitcoin products saw $866.7M in outflows, one of their worst sessions on record, while Ethereum lost another $259.6M. Bitcoin feels caught between conviction and fear, long-term story intact, but traders are hesitant to press. Solana remains the standout, still pulling steady inflows since its ETF debut on October 28 with no net outflows to date. XRP joined the ETF party this week with a strong debut, clocking $58M in first-day volume, the best for any ETF launch this year and narrowly edging out Bitwise’s Solana fund. Institutional interest in digital assets is clearly still there, even if near-term sentiment feels heavy.
The worst of this washout may be behind us. The market still needs time to find its footing, but patience looks like the right trade here.
Crypto Charts
ETF Flow
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This research is for informational use only. This is not investment advice. Other than disclosures relating to Secure Digital Markets this research is based on current public information that we consider reliable, but we do not represent it is accurate or complete, and it should not be relied on as such. The information, opinions, estimates, and forecasts contained herein are as of the date hereof and are subject to change without prior notification. We seek to update our research as appropriate.
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