Crypto Market on the Verge of Reversal: Research

Arcane Research outlines how the crypto market could perform in the short, medium and long term

Crypto Market

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Analysts from Arcane Research studied the major crypto market movements that occurred in October and predicted the future performance in a new report

The research data showed that BTC and exchange tokens outperformed the large caps index between Oct.1 – Oct. 26. When Elon Musk acquired Twitter, Dogecoin produced a 144% gain, pushing the large caps index above Bitcoin with a 20% monthly yield.

Meanwhile, October’s Bitcoin spot market was driven by increased volume and lower volatility. It also benefited from a short squeeze that briefly pumped the market. Despite an overall boost, the short squeeze did change the BTC price substantially. Momentum has stopped, indicating that traders should brace for longer consolidation.

Currently, BTC spot volume is up 46% in the last seven days, while the 30-day volatility index is at a two-year low. In addition, the seven-day volatility index sitting at 2.2%, compared to the yearly average of 3%.

Crypto market predictions

BTC’s attractive price gives more opportunities to investors. However, the research suggests the best approach to this market is to dollar cost average in the short term rather than using leverage. Furthermore, as Bitcoin now closely follows the U.S. equities market, it is important to track Q3 earnings reports.

The future crypto market movements depend on the upcoming rate hike, which Federal Reserve Chairman Jerome Powell is set to announce today. In the most likely scenario, future market hikes will keep BTC and other asset classes elevated. This way, “the now 4.5-month-long trading range to hold firm, with dampened activity, leading to a longer lasting opportune environment to stack sats.”

If the policies are going to soften, “pivot anticipations will lead to similar reactions and revitalize BTC’s digital gold narrative.”

As for the long-term predictions, the adoption of Bitcoin and digital assets will remain an emerging trend. A clearer regulatory framework can drive increased market participation. Nevertheless, chances are BTC growth will remain muted for at least a year, although many analysts believe that Bitcoin’s current price is undervalued.

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