Why Bitcoin Price is Down Today? High-Impact Events Spark Market Uncertainty

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Bitcoin (BTC) price dropped around 4 percent in the past 24 hours to trade around $69,532 on Friday, November 1, during the early European session. After teasing a rally towards its all-time high earlier this week, the flagship coin closed October trading at around $70k, below the highest monthly close of about $71,297. 

The altcoin market led by Ethereum (ETH) followed the same correction pattern, thus leading to a 5.2 percent drop in the total crypto market cap.  As a result of the heightened crypto volatility, nearly $300 million was liquidated from the crypto market, with around $247 million involving long traders.

Major Factors that Affected Bitcoin Price Action Today

Notable Selloff from US Spot BTC ETFs

Bitcoin price lacked bullish momentum in the last 24 hours as most of the U.S. spot BTC ETF issuers registered notable cash outflows. Apart from BlacRock’s IBIT, which registered around $318 million, the rest of the top five spot BTC ETF issuers registered notable cash outflows on Thursday.

Specifically, ARKB reported an outflow of $94M, and Fidelity’s FBTC and Bitwise BITB each registered an outflow of $75M on Thursday. As a result, the US spot BTC ETFs registered a net cash inflow of about $32 million, after registering nearly $2 billion in the previous two days.

End-of-Month Options Expiry

Bitcoin price reacted to the $2 billion options contracts expiring on Friday, although smaller than last month. According to market data provided by Coinglass, the Options volume of Deribit exchange was about $1.96 billion in the past 24 hours.

Earlier this week, Joshua Lim, the head of derivatives at Arbelos Markets, noted that the CME Bitcoin options experienced the largest volume, just a few days ahead of the US election. Meanwhile, the Open Interest (OI) has surged to $1.3 billion, at the strike price of $80k on the Deribit exchange.

Uncertainty from High-Impact Events

Bitcoin price has enjoyed a steady growth in the past few weeks fueled by high demand from institutional investors. However, uncertainties from short-term high-impact news have discouraged some investors, amid anticipated increased volatility.

Consequently, more investors have accelerated profit-taking, thus weighing down the bullish sentiment.

For instance, the crypto market is expecting Republican presidential candidate Donald Trump to win the 2024 elections. Additionally, Wall Street analysts expect the Fed to initiate another rate cut next week.

Developing Short-Term Bearish Technical Outlook

According to crypto analyst Ali Martinez, Bitcoin price experienced a significant resistance above $73k, thus a brief correction was imminent to rejuvenate the bullish sentiment. From a technical analysis standpoint, Bitcoin price is expected to find a solid support level above $69k, which will yield the next rally towards $78k in the near term.