Bitcoin: Breakout or Breakdown?
October, typically a strong month for crypto, flipped the script with one of the largest liquidations ever seen. The move hit sentiment hard, leaving investors cautious and defensive. The Fear and Greed Index now sits near 20, echoing fear levels last observed during the trade war turbulence in March and April. Yet history shows that moments of exhaustion often precede turning points. With tensions between the US and China easing, there is a sense that the worst might be behind us and the next phase could already be forming. As the saying goes, the time to buy is when there's blood in the streets.
One important point to mention is that in recent months, long term holders have sold over 400,000 Bitcoin, nearly two percent of total supply, marking one of the largest distribution phases in Bitcoin’s history. Despite this, the price continues to hold above 100K, about 25 percent below the highs. This is not panic selling but a strategic rotation, as early holders pass liquidity to ETFs, funds, and corporate treasuries. Institutions now act as a stabilizing force, providing consistent demand and deeper liquidity. As Jordi Visser describes, this is Bitcoin’s IPO moment, when ownership expands from early believers to long term institutional investors. The process may feel heavy in the short term, but it reduces concentration and reflects a maturing market.
Now looking at the technical level, Bitcoin is flirting with its 50 week moving average, a historical level that has often supported major rebounds. This also coincides with the psychological level of 100K. Losing it could trigger fear, while defending it could restore confidence. We can also observe a tightening of the Bollinger Bands, which means volatility is compressing. And as with a compressed spring, the next move often comes fast—but in which direction? Usually, when price touches the lower band, it signals exhaustion and quiet accumulation, often preceding strong directional moves. Still, markets can remain irrational longer than expected, so caution is warranted.
Lastly, global liquidity measured by M2 represents the total money circulating in the economy. When liquidity expands, it tends to stimulate markets and lift asset prices like Bitcoin. Governments are once again leaning toward monetary expansion, creating a supportive backdrop for risk assets. In the United States, the Federal Reserve is cutting rates and preparing to end quantitative tightening by December. The resolution of the government shutdown restores normal Treasury issuance and spending, easing liquidity pressure. In China, policymakers are supporting growth through credit easing, while Europe maintains fiscal and bond programs. Japan’s new Prime Minister has reaffirmed monetary stimulus to boost exports and investment. Together, these actions expand the global money supply, historically a favorable force for Bitcoin as investors seek protection from currency debasement.
Technical and institutional forces are converging. Bitcoin is holding firm around the 200 week moving average and the 100K zone, levels that have historically marked long term bottoms, while major funds are accumulating. The structural rotation from early holders to institutions adds stability, depth, and credibility. With expanding global liquidity, softening geopolitical tensions, and stronger participation from traditional finance, the foundations for the next cycle are being built.
In my view, Bitcoin is not collapsing, it is maturing. This is not an ending but a reset, a quiet consolidation before the next expansion. If this truly is Bitcoin’s IPO era, the base forming now could become the foundation for the next decade of growth. Markets can be emotional and impatient, but fundamentals eventually prevail. Patience defines conviction. Stay focused, build your position, and be ready for what comes next.
