Monday Market Brief: Bitcoin holds its trend as leverage is cleared on both sides

Bitcoin closed the week at $83,800, down 3.1% from the previous weekly close of $86,501. The decline did not break the trend. It was the fourth consecutive weekly close above the 50-week moving average, which now sits near $77,200. Price remains about 8.6% above that line.

The range has also become clearer. For three consecutive weeks, the weekly high has stalled near $87,000. Last week's low, at $80,347, came on Thursday 8 October. Bitcoin has now spent a month between roughly $80,000 and $87,000. It is no longer in the bearish regime of the summer, when it traded near $63,000. It has not yet shown the conviction of a new uptrend either.

Participation thinned. Bitfinex BTC/USD volume fell to 4,324 BTC over the week, 38% below the previous week and the lowest since early August. On Binance, BTC/USDT spot volume reached $8.2 billion, down from $9.4 billion a week earlier.

Institutional flows turned sharply negative. US spot crypto ETFs and ETPs recorded $1.234 billion of net outflows over the week. Bitcoin products lost $678.9 million, reversing the previous week's $241 million inflow. Wednesday 7 October alone accounted for $484.9 million, the largest single-day Bitcoin ETF outflow since June. Fidelity's FBTC lost $380 million over the week and ARK's ARKB $207 million, while BlackRock's IBIT was flat. Ether products lost $542.2 million, extending the divergence noted last week.

Derivatives explain the shape of the week. On Thursday, $1.114 billion of positions were liquidated across the market. Of that total, $1.05 billion, or 94%, were longs. Over the past 24 hours the pattern reversed: $200.6 million was liquidated, mostly shorts, as Bitcoin recovered toward $84,000.

The flush has been followed by only a marginal rebuild. Open interest rose by 1% to 4% over the past 24 hours across Bitcoin, Ether and Solana. Funding rates on Binance, the periodic payment between long and short holders of perpetual futures, remain positive but low. They stand at 0.0037% per eight hours for Bitcoin, 0.0017% for Ether and 0.0069% for Solana, all below the exchange's 0.01% baseline. Longs still pay to hold their positions, but without the urgency of a crowded trade.

Why it matters: a market hunting leverage while it waits for macro

Thin spot volume, heavy liquidations and large ETF redemptions describe a specific type of market. Price is not being set by fresh spot demand. It moves toward the largest pools of leverage, clears them, and then turns. Last week the long side paid. Over the weekend, it was the turn of the shorts.

Current positioning suggests this pattern can continue in both directions. The liquidation map shows a broadly balanced book. A decline to $80,000, about 4.5% below the weekly close, would expose around $540 million of long positions to forced closure. A rise to $87,000, about 3.8% above, would put $450 million to $480 million of short positions at risk. The two walls are of similar size and at a similar distance. Long exposure is slightly larger, which gives the downside a marginally stronger pull.

In our view, the ETF data matters more than the liquidations. Leverage flushes are routine in this market. What is new is that institutional demand, which supported the September breakout, has reversed. The concentration of redemptions also deserves attention. Outflows came mainly from Fidelity and ARK, while BlackRock's fund was flat. That points to repositioning by specific holders rather than broad institutional capitulation.

The Ether figures are more telling. Ether products lost $542 million, close to the Bitcoin outflow in dollar terms, for a second consecutive week of redemptions. Allocators are cutting higher-beta exposure first, a pattern consistent with defensive positioning ahead of a macro event.

The anniversary offers a useful reference point. On 10 October 2025, days after Bitcoin's all-time high near $126,000, more than $19 billion of positions were liquidated in 24 hours, according to CoinGlass. That unwind opened the bear phase that took Bitcoin below $58,000 by early summer. Thursday's $1.1 billion flush was a small fraction of that size. By that measure, the leverage problem in today's market is of a different order of magnitude. This helps explain why the trend signal survived a drawdown of about 7% from the previous weekly close to Thursday's low.

For institutional desks, the practical consequence concerns execution and timing rather than direction. In a market driven by liquidation clusters, intraday moves of 4% to 5% can occur without any change in fundamentals. Thursday's drop to $80,347 took place on modest spot volume and was partly reversed within days. Allocators building positions in these conditions face a choice between paying up during squeezes and buying into forced selling. The second has generally offered better entry prices, at the cost of sharper mark-to-market swings. For risk managers, a balanced book also means the next large move is likely to be amplified in whichever direction it starts. Volatility is a more reliable forecast for this week than direction.

The macro backdrop itself barely moved. The 10-year Treasury yield touched 5.34% at the start of the month before ending the week about 10 basis points lower. Oil was broadly unchanged, with WTI near $90 and Brent above $100. The CME FedWatch tool puts the probability of a hike at the 27-28 October FOMC meeting at 19.4%, against 20.5% a week ago. The probability of at least one further 25 basis point hike by year-end stands at 86%.

This puts Wednesday's CPI release at the centre of the week. Consensus expects September headline inflation at 3.6% year on year, up from 3.4%. Core inflation is expected at 2.5%. The gap between the two is the detail that matters. Much of the acceleration comes from energy, a component central banks often look through. Even so, a headline print above 3.6% would raise the risk of an October hike. For a market carrying slightly more long leverage and facing negative institutional flows, that combination would likely pull price toward the $80,000 wall.

The Big Whale's take

We maintain our read of a market that has left the bearish regime without confirming a new trend. Four weekly closes above the 50-week average are a meaningful signal. A month inside a $7,000 range, on falling volume and with institutional outflows, is not the profile of a market ready to break higher on its own.

The near-term direction depends on CPI, and we do not see the risk as symmetric, even if the liquidation map is. A hot print would hit two weak points at once: rate expectations and long-heavy positioning. ETF outflows would likely extend, and $80,000 would become the obvious target. A break below it would open the way toward the 50-week average near $77,200, the line that would invalidate the trend signal.

An in-line or softer print would change the picture quickly. A push through $87,000 would trigger the short liquidations sitting above it, and a squeeze could carry Bitcoin toward $90,000 within days. Whether such a move holds is a separate question. Sustaining a break above the range would require ETF demand to return. Short covering alone has failed to carry the market past $87,000 in three attempts.

There is also a limit to the relief a benign CPI can provide. Even in that scenario, markets would still price a high probability of another hike before year-end. A softer print delays tightening. It does not reverse it.

The conditions to watch are specific. A CPI reading above 3.6%, or October hike odds rising well above 20%, would favour the downside. A daily close above $87,000, accompanied by renewed Bitcoin ETF inflows, would be the first sign of a genuine breakout rather than another leverage sweep. Until one of these appears, we expect price to keep moving between the two liquidity pools.

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