Bitcoin has slipped below the pivotal $108,000 mark in early November, marking a concerning shift in market dynamics as the cryptocurrency trades at a notable discount on Coinbase for the first time in months. This downturn comes on the heels of a turbulent October, which saw the world’s leading digital asset face a challenging market environment.
The Coinbase premium turned negative for four consecutive days from October 31 to November 3, signifying a prolonged period of discount trading not seen since mid-August. This negative premium serves as a crucial indicator of retail sentiment in the U.S. market, where an increase in demand typically results in Bitcoin trading at a premium to the global average price. When the trend reverses, as it has done recently, it reflects a shift in investor behavior towards bearishness.
According to crypto analytics firm Coinglass, this negative premium aligns with increasing selling pressure in the U.S. markets, indicating a retreat from risk appetite among traders. October proved to be particularly challenging for Bitcoin holders, as the cryptocurrency suffered nearly a 5% decline during the month, breaking a seven-year tradition of strong performances in October—the phenomenon referred to as “uptober” by traders.
The downturn was exacerbated by a flash crash at the start of October, leaving Bitcoin struggling to regain its lost momentum as it traded at $107,636 on Monday morning.
ETF Outflows Signal Weakening Demand
During the same period that the Coinbase premium turned negative, a significant outflow of capital from U.S.-listed Bitcoin exchange-traded funds (ETFs) was observed. On October 30, these ETFs witnessed a net outflow of $488 million, with all twelve funds reporting zero inflows. In stark contrast, rival cryptocurrencies like Solana experienced net inflows, reinforcing the narrative of diminishing domestic demand for Bitcoin.
This trend has led the cryptocurrency to dip below a crucial support level near $108,000, disappointing many traders who were hopeful for a recovery rally.
Volatility Squeeze Indicates Potential Breakout
On the technical front, Bitcoin appears to be entering a pivotal phase. Volatility has compressed to multi-week lows, with the Bollinger Bandwidth indicator recently hovering near 15—a level that has historically preceded major price movements. This tightening signifies a market coiling for a potential breakup, whether bullish or bearish.
Traders have identified critical price levels to monitor closely. A sustained move above the resistance at $112,000 could ignite a bullish rally, whereas a downturn breaching the psychological support level at $100,000 may signal a deeper correction in the medium term. The bearish trend line currently exhibiting resistance at $109,800 lends additional weight to the prevailing downward pressure on Bitcoin.
Immediate resistance points are now located near $109,500, with further resistance identified at $110,500. A close above these levels could indicate a run toward $111,200, while immediate support appears around $107,400. Should the price continue to decline, significant support levels are pegged at $106,500, and further losses could test the waters as low as $104,200.
Current momentum indicators such as the MACD and the Relative Strength Index are suggesting bearish behavior persists in the short term. As market participants remain cautious amid ongoing macroeconomic uncertainty, the Bitcoin price consolidation around $108,000 reflects a broader indecision as the year draws to a close.
