The short-term path of the cryptocurrency market remains under the influence of macro conditions. Also, bears have taken over the market. The leading crypto Bitcoin is struggling to break the psychological resistance of $ 20 thousand. The Merge wind around the leading altcoin Ethereum also seems to have subsided. In this environment, the focus of investors and traders turned to developments in the last quarter.
September has been quite tough in the crypto money market
cryptocoin.comAs you follow, we left behind another tough September. Most altcoins, including Bitcoin and Ethereum, continue to orbit in the red or range. When this is the case, greener hopes shifted to the last quarter. “Wake me up when September ends” was a prevailing sentiment for cryptocurrency HODLers last month.
September saw stubborn inflation and more aggressive central banks. Hence, macro conditions continued to determine the short-term path for cryptocurrencies. Thus, the bears took over the market. Over the course of September, bearish sentiments have heated up much more as seen in the red bars below, showing how many sells, sells, sold or bears are mentioned.
Decreased demand for BTC and ETH
The total cost of using a Blockchain determines the demand to spend and use it. Last quarter, Bitcoin fees came in just under $30 million from the network. For benchmarking, it was $42.9 million in the second quarter of 2022.
However, fees for the leading altcoin Ethereum dropped further. Fees were $1.29 billion in Q2 versus $264 million in Q3. This means a 79% decrease on a quarterly basis. Despite a drop in demand for blockchain, prices have remained relatively good with Bitcoin in consolidation and ETH gaining 30% QoQ.
Additionally, the net flows indicate a neutral sentiment in BTC. On the other hand, it shows that ETH has more bullish stance compared to BTC. The leading cryptocurrency has recorded modest inflows to centralized exchanges of under $50 million. The high, however, saw net outflows of $192 million in the second quarter. For ETH, over $1 billion in ETH left exchanges in the second quarter. Third-quarter outflows were $57 million less than in the second quarter.
Indicators to follow in October for the cryptocurrency market
Bitcoin struggled to keep up with the $20,000 psychological support barrier throughout September. According to analysts, without good support from the whales and the individual, a significant increase in price is a distant dream. Santiment’s whale metrics show that there is neither whale accumulation nor major benefit in BTC to be excited about.
On the other hand, key BTC holding between 100 and 10,000 BTC continues to dump whales. Over the past year, 3.5% of the supply of these key addresses has shifted to addresses that have much less impact on future price action. In September alone, another 0.4% of the BTC supply was thrown away. An important trend to watch out for in October is the possible accumulation of whales.
Experts note that the amount of BTC moving from address to address is quite scarce. So this caused the NVT signal to signal bearish for a second consecutive month. Therefore, experts consider that the same increase may be a bullish indicator.
BTC funding rates presented another alarming trend that traders are increasingly craving when the price is not falling. Because, after the longs go high enough, another drop occurs. Traders try to short temporarily. However, then they give up and start longing again.
That’s why it’s so important to continue to monitor the key indicators outlined above. A reversal in these on-chain metrics is likely to indicate a bullish trend for BTC, ETH and the broader market.
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