Analysts have questioned whether November deserves its reputation as Bitcoin’s historically “strongest month” after the cryptocurrency dropped 10% over the past seven days and briefly sank below $90,000.
“Historical averages suggest strength, but those numbers are skewed and the current backdrop is anything but normal,” James Harris, the CEO of crypto yield provider Tesseract, told Cointelegraph.
Harris said that while the break below the long-term average is noteworthy, it is “not the full picture.”
Bitcoin (BTC) is down 15.37% since the start of the month and is on track for its worst November since 2019, when it closed the month down 17.27%, according to CoinGlass.
Bitcoin ended 3.69% down in October. Source: CoinGlassBitcoin is trading up 1% over the past day at $93,290, climbing from a low of under $89,400, according to CoinMarketCap.
Harris said comparing the current market environment to previous years “is not like-for-like,” and noted that the US government shutdown had delayed key economic data for six weeks.
“When it reopened, the backlog of information forced investors to reprice inflation and rate expectations almost overnight,” he said.
Confidence among market participants in a Federal Reserve rate cut in December has also plummeted to 41%, according to the CME FedWatch Tool.
New Bitcoin high by year-end possible, but unlikely
Harris said it’s still possible for Bitcoin to reclaim momentum and push to new all-time highs before the end of the year, but he isn’t betting on it.
“It is possible, but not something we are forecasting,” he said.
Bitcoin last reached an all-time high of $125,100 in early October, prompting traders to look toward November, historically its strongest month, for a potential continuation of the rally.
Bitcoin has seen an average return of 41.35% in November since 2013, a figure inflated by a 449% surge in 2013, which is about 277% higher than that year’s second-strongest gaining month, March.
Bitcoin showing “early signs of stabilization”
Bitfinex analysts believe that the worst of Bitcoin’s drawdown may be nearing an end.
Bitcoin is trading at $93,290 at the time of publication. Source: CoinMarketCap“It feels like it is time for a local bottom to be established relatively soon,” the analysts said in comments shared with Cointelegraph.
“Across multiple historical cycles, sustainable bottoms have only formed after short-term holders have capitulated into losses and not before,” they added.
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However, the November gains traders are hoping for may spill into December instead. The Bitfinex team said that selling pressure is beginning to ease, with “early signs of stabilisation following one of the sharpest corrections of the cycle.”
Analysts at crypto payments firm B2BINPAY agreed that “a durable recovery can form just as quickly.”
“The first meaningful resistance is at the $97,000–$100,000 band,” they said. “Until BTC attempts to reclaim it, sentiment is highly likely to stay defensive.”
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Source: https://cointelegraph.com/news/bitcoin-price-november-gains-historic-analysts-debate?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
