Bitcoin Ready for ‘Uptober’ Rally After $1.7B Liquidations Reset Market

Bitcoin back in action ahead of Uptober. | Credit: Manuel Mazzanti/NurPhoto via Getty Images..

Key Takeaways

October has been crypto’s best-performing month since 2013, with returns averaging above 20%. Bitcoin has been trading up 0.6% at $113,230 in the past 24 hours, and BTC dominance has been up at 57.7%. Macroeconomic announcements from the U.S. could steer market sentiment this week.

After a brutal $1.7 billion wipeout in leveraged positions on Monday, crypto markets are finding their footing.

Investors are rotating back into Bitcoin (BTC), setting the stage just as October—historically one of crypto’s strongest months, dubbed “Uptober”—looms on the horizon.

The Days Ahead

According to an analysis from QCP Group, yesterday’s $1.7 billion in liquidations and the resulting volatility have already begun to smooth out.

It notes that traders had been leaning into altcoin season, which fueled massive speculation for the likes of Aster (ASTER), Hyperliquid (HYPE), Pump.fun (PUMP), and Avantis (AVNT).

The altcoin season index spiked to 100 on Sept. 20 before tumbling to 65, reflecting a sharp rotation out of alts.

At the same time, Bitcoin’s dominance climbed above 57% while Ethereum’s share slipped to 12%, though it has since recovered slightly to 13%. At press time, Bitcoin dominance stood at 57.7%.

QCP posits that investors are rotating back into BTC and positioning themselves ahead of Uptober, which has historically been Bitcoin’s best-performing month.

Conversely, September aka “Redtember” is BTC’s worst-performing month, though this year Bitcoin’s risen from $108,000 on Sept. 1 and peaked above $117,000 on Sept. 19.

Uptober

There are a myriad of other factors affecting market action this cycle, which include the ongoing acquisition of BTC by the likes of Strategy and Metaplanet, huge exchange-traded fund (ETF) inflows, and overall bullish sentiment amongst investors.

However, there’s still some uncertainty as the U.S. Federal Reserve’s Jerome Powell is expected to speak on the U.S. economy again this Wednesday, and Core PCE data regarding U.S. inflation rates will be published this Friday.

QCP argues that if inflation is steady, it may signal further rate cuts from the Fed this year, extending liquidity into Q4 and catalyzing another BTC breakout, which may ultimately spur a long-overdue altcoin season.

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