Analysts Predicted Bitcoin's November Bull Run -- Here's How

Conor Maloney

Nov. 6, 2020

Crypto analytics platform CoinGecko reported on Bitcoin price, market sentiment, and recent activity in the DeFi space, giving traders insights into market movements.

Analysts Predicted Bitcoin's November Bull Run -- Here's How

Key Takeaways

Bitcoin price hit multi-year highs at $13,788, rising 28% in October.
Bitcoin Perpetual Swaps saw a 40% rise in Open Interest (OI) since early September, a bullish indicator.
The deflation in DeFi pointed to a cycling out of altcoins and back into BTC.

For technical analysts, October gave hints at the bull run to come in November. Open Interest on Bitcoin Perpetual Swaps rose $87 million or 40%, most likely due to investors seeking to capitalize on Bitcoin’s upward price momentum.

Overall, Bitcoin rose 28% in October, peaking at a multi-year high of $13,788. Trading volume rose 22% overall, marking the best monthly performance since the crash in Q1 2020.

DeFi Wavered, But Overall Crypto Market Cap Grew

The total volume on decentralized exchanges (DEXes) fell 32% in October, a $9.4 billion drop from the month before. Uniswap alone lost $5.5 billion, a 59% reduction in volume.

Uniswap held onto market dominance despite the lower volumes and actually increased its market share from 66% to 69%.

DEX Dominance in DeFi — Despite the steep drawdown from September to October, Uniswap continues to dominate the DEX space. Source: Dune Analytics

While DeFi TVL plateaued and DEX volumes took a hit, the overall crypto market saw healthy growth. The total market cap of all cryptocurrencies grew 10%, reaching a yearly high of $378 billion in October.

Investors Cycle Into Bitcoin

Many traders likely sold their DeFi positions this summer and recycled them back into Bitcoin, according to the co-founder of CoinGecko, Bobby Ong. He told Crypto Briefing that:

“This is the typical altcoin to bitcoin cycle that has repeated many times in the past. At some point in the next few weeks or months, profits from bitcoin will be recycled back into the altcoin markets.”

Major institutions like MicroStrategy, PayPal, Square, and DBS Bank took steps towards integrating or investing in cryptocurrencies, and this most likely contributed to bullish sentiment and market cap growth overall.

With growing institutional interest, so too does Bitcoin’s correlation with the broader stock market, however.

Ong added:

“This was not the case several years ago as it used to be completely uncorrelated asset classes. Things started changing once CME started having Bitcoin futures as now institutions can easily take positions in this market and whenever there is a sell down in the traditional market, it will affect the crypto market too.”

This correlation revealed itself during this week’s Presidential election, according to Ong. As the S&P 500 lifted on hopes of a Biden win, Bitcoin followed closely behind.

Ultimately, Bitcoin’s latest run-up to and past $15,000 this week may well be a symptom of altcoin traders following institutions back into BTC positions. If Bitcoin continues to inflate, altcoin activity will likely pick up, drawing the market even higher.

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