In the world of cryptocurrency, the latest developments have traders and investors on their toes as Bitcoin (BTC) and Ether (ETH) navigate the complexities of futures markets and the potential for downward corrections. The recent surge in prices has opened up CME futures gaps, with Bitcoin’s gap spanning between $110,000 and $111,335 and Ether’s beginning around $4,000. These gaps, created when the CME market closed for the week on Friday and reopened on Sunday, are often filled, suggesting a possible pullback in prices.
Market Dynamics: Gaps and Trends
The concept of CME futures gaps is well-known among traders. Historically, these gaps tend to get filled, meaning that despite the current upward trajectory, Bitcoin and Ether might see a dip to retest those lower levels. In fact, Bitcoin’s monthly low often occurs within the first ten trading days, indicating potential volatility in the coming weeks. However, this is juxtaposed against October’s reputation as “Uptober,” a month noted for strong performance with an average return of 22%.
Broader Market Sentiment
The optimism in the crypto market is mirrored in the broader financial landscape. The CoinDesk 20 Index, which tracks the performance of major cryptocurrencies, has gained 3.2% over the past 24 hours, with all constituents in the green. Meanwhile, precious metals like gold and silver are also seeing gains, with gold climbing to $3,815 and silver nearing all-time highs at $47.
Economic Indicators and Their Impact
Looking beyond crypto, macroeconomic indicators are in focus, particularly with the upcoming U.S. jobs report. Nonfarm payrolls are expected to show a modest increase of 39,000 new jobs, alongside a steady unemployment rate of 4.3%. This data, coupled with an ISM Services PMI forecast of 52, highlights ongoing economic expansion. Such figures could influence market sentiment and subsequently, the crypto markets.
Key Events and Developments
Several significant events are shaping the crypto landscape. PancakeSwap (CAKE) is set to discontinue support for Polygon zkEVM liquidity pools and Perpetual V1 orderbook, advising users to withdraw funds by the deadline. In the macroeconomic sphere, Fed Governor Christopher J. Waller will deliver a speech on payments in Frankfurt, potentially influencing market dynamics.
Additionally, token launches and governance votes are on the horizon. Anoma (XAN) will be listed on KuCoin, and Ronin (RON) treasury buybacks are scheduled to begin. Meanwhile, Lido DAO is voting on its Lido V3 upgrade, which could have significant implications for staking operations.
Market Movements: A Closer Look
Amid these developments, Bitcoin is currently trading at $112,164.29, up 2.54% from Friday. Ether, too, has seen gains, trading at $4,136.88, up 3.1%. However, the derivatives market indicates a cautious stance, with BTC futures open interest declining to approximately $29 billion from a recent high of $32 billion. This suggests traders are scaling back exposure, with a shift from a bullish bias as more shorts enter the market.
In the options market, the BTC Implied Volatility Term Structure is upward-sloping, and the 25 delta skew for short-term options has increased. This indicates a bullish bias, although the 24-hour put-call volume shows puts dominating, reflecting ongoing caution and a desire for downside protection.
Funding Rates and Liquidations
BTC funding rates have turned negative, with Hyperliquid showing a significant drop to -6%. This signals growing bearish sentiment, as traders position for a potential decline in BTC prices. Coinglass data reveals $350 million in 24-hour liquidations, with a notable split between longs and shorts.
Conclusion: Navigating the Crypto Terrain
As Bitcoin and Ether navigate potential futures gaps, the crypto market remains a landscape of opportunities and challenges. Investors must keep an eye on macroeconomic indicators, regulatory developments, and market sentiment shifts. With October historically being a strong month for Bitcoin, the coming weeks could be pivotal as traders balance between bullish hopes and cautious realities.
Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
