Why is the crypto market up today (Oct 31)?
Bitcoin and Ethereum saw gains as markets bounced back from yesterday’s slump, but the crypto market is still under pressure.
- Crypto markets are bouncing back up after yesterday’s rate cut decision
- The Federal Reserve is signaling a more cautious stance on inflation, indicating no further rate cuts
- Spot crypto ETF outflows reach $600 million as investors reassess risk
- Despite today’s uptick, Bitcoin is set to see its “Red October” in seven years
After a week of mostly downward pressure, crypto markets are finally bouncing up. Bitcoin is back above $109,000, while Ethereum reclaimed the $3,800 level, with major altcoins posting modest gains. Still, the slight recovery is clouded by the worsening macro outlook as Bitcoin sees its first “Red October” in seven years.
Bitcoin (BTC) was up 1.7% on Friday, October 31, trading at $109,225, bouncing back from the prior day’s slump. Ethereum (ETH) registered a similar gain, trading at $3,826, up 1.55%, while most other altcoins saw gains.
Crypto market sentiment is low as ‘Uptober’ disappoints
The day prior, Bitcoin was down to its weekly low of $106,000, despite the Federal Reserve’s decision to cut interest rates by 25bsp. While lower interest rates are favorable for the crypto market, most of the traders already expected it.
At the same time, Fed Chair Jerome Powell signalled a more cautious outlook on inflation, indicating that October’s rate cut might be the last this year. The shift in sentiment was coupled with major ETF outflows. Weekly Bitcoin and Ethereum ETFs reached $600 million by Friday, showing lowered risk tolerance in the crypto markets.
This news coincided with already low sentiment around crypto this week. “Uptober,” a term used for past October rallies, failed to materialize, and Bitcoin fell 15% from its October 6 all-time high. The decline saw it register a monthly decline of 6.5%.
