Bitcoin heads for second red October as demand weakens

What happened

Bitcoin is on track for a second consecutive negative October after five years of consistent gains during the month. According to data from CryptoQuant cited by Bitcoinist, the cryptocurrency fell 4.2% between September 30 and October 25, declining from $83,567 to $80,051. This follows a 3.8% loss in October 2025, marking a sharp reversal from the pattern that earned October the nickname "Uptober" among traders.

The month's weakness reflects broader market challenges beyond seasonal disappointment. CryptoQuant's analysis revealed that Bitcoin spot demand has remained negative since October 14, with cumulative demand falling approximately 76,000 BTC over the preceding 30 days. The Coinbase premium, which measures price differences between Coinbase and other exchanges as a proxy for US institutional demand, also stayed negative throughout October, signaling reduced buying interest from major market participants.

The selling pressure presented a mixed picture when viewed against longer-term trends. U.S. spot Bitcoin ETFs recorded $110 million in net inflows on October 26, ending a two-day outflow streak, with BlackRock's iShares Bitcoin Trust (IBIT) accounting for nearly all the gains, according to Cryptonews.com. However, this recovery remained tentative, as U.S. spot Ether ETFs experienced $88 million to $90 million in outflows over the same period, indicating that institutional demand remained uneven across digital assets.

Why it matters

The loss of October's historical bullish pattern carries significance for market psychology and price discovery. Between 2020 and 2025, October delivered an average return of 18.1% for Bitcoin, creating expectations among traders for seasonal strength. Two consecutive negative Octobers suggest that established seasonal patterns may no longer reliably predict price direction, forcing market participants to focus more heavily on fundamental on-chain indicators and macroeconomic conditions rather than calendar-based strategies.

What the data shows

Technical levels have emerged as important reference points for assessing market stability. CryptoQuant identified the 73,000-77,600 range as a critical support zone if selling pressure persists, noting that Bitcoin's 365-day moving average and the realized price of short-term holders both fall within this region. Galaxy Research highlighted Bitcoin's 50-week moving average near $76,000 as a key technical threshold, with the cryptocurrency trading approximately 5% above that level at $80,000 when Galaxy's assessment was published.

Background

Bitcoin's October track record had been remarkably consistent until recently. In 2020, the cryptocurrency gained 27.6%, followed by a 40% rally in 2021 and a 28.5% increase in 2023. Even smaller October performances, such as the 5.5% gain in 2022 and the 10.9% rise in 2024, still resulted in positive monthly closes. This consistent performance created a widespread perception among traders that October favored Bitcoin buyers, reinforcing seasonal trading strategies.

Galaxy Research added analytical depth to the current weakness by declaring the bear market over in an October 26 assessment, according to Cryptonews.com. The firm pointed to a potential bottom near $76,500 on June 30 and cited Bitcoin's recovery above key long-term moving averages, particularly the 50-week moving average, as evidence that the market's underlying structure had improved. Galaxy's analysis also highlighted reduced selling pressure from long-term holders, macro traders, and basis-focused funds, along with declining net-long positions in CME Bitcoin futures.

What to watch

The immediate focus remains on whether Bitcoin can sustain the ETF inflows that appeared on October 26 or whether demand will fade again. Bitcoinist noted that several upcoming economic developments could influence investor sentiment, including the Federal Reserve's October 28 policy decision and the U.S. midterm elections scheduled for November 3. Broader interest-rate expectations, institutional investment flows, and shifts in overall risk appetite may all affect Bitcoin's direction as October draws to a close.

Galaxy Research cautioned that its bullish thesis is conditional on Bitcoin maintaining support above the 50-week moving average. A sustained weekly close below that level, without a quick recovery, could undermine the accumulation narrative and raise the risk of another decline. If ETF inflows fade and Bitcoin loses critical long-term moving-average support, the bullish price thesis would face a serious challenge, potentially signaling that the weakness is part of a longer correction rather than a temporary consolidation.

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