Big Idea

Bitcoin hits a new all time high then recedes on uncertainty with China & US trade relations. All indicators still point bullish. I believe we’re only seeing the beginning of this Bitcoin cycle’s top.

Key Metrics

Exchange Reserves decline again: 2,395,985

Last month’s exchange reserves came in at 2,502,870 showing a decrease of over 107,000 BTC or ~$11.7B equivalent of BTC pulled off of exchanges. This decrease in supply highlights demand for Bitcoin that is not going to be traded in the near future.

Should demand spike, supply would realistically be inelastic as market participants are holding out for long term appreciation.

October set a new record low for Copper / Gold Ratio

October saw another drop to new record lows in Copper / Gold as gold prices pushed to all time highs cross $4,300 / oz. Investors continue to see a flight to gold as the safe haven and October was no different.

The Copper/Gold ratio is a key macro indicator for industrial manufacturing optimism and growth as copper is a heavily used industrial commodity. When the Copper/Gold ratio is low, it means Gold price is increasing relative to gold, indicating investors are risk off and saving more. When copper price increases relative to gold, it signals additional manufacturing, industrial demand, and growth optimism.

Bitcoin Realized Price slowly climbing: $55,876

October’s end of month realized price ticks up another ~$2k from September’s realized price of $53,874. Bitcoin realized price is the average price that each coin last moved on the network. This value tends to set the floor and mirrors the 200wma, but indicates Bitcoin holders willingness to move and spend Bitcoin.

Bitcoin realized price has also signaled previous peaks when the realized price reaches peak price of previous cycle. For this cycle, realized price would need to reach ~$69k to signal the peak of the last cycle. However, with the structural institutional buying patterns we’re seeing, no single indicator should be used to determine tops of bottoms.

October Global Liquidity Expands by another ~$3T

Global Liquidity has reached ~$114T from September of ~$111T an increase in $3 trillion. As global liquidity increases, stemming from central banks dropping interest rates (like the most recent 25bps cut by the FED), asset prices tend to move respectively.

This below graph shows Global Liquidity shifted 10 weeks with a Bitcoin correlation of >0.9.

Bitcoin Relative Strength Index (RSI) drops 3 points

October RSI is ending at 66 from 69 with a decrease of ~2 points which correlates with the relative sideways movement in Bitcoin for October despite hitting a new all time high (ATH). Anything over 50 is still considered bull market territory.

Network Hashrate broke a new all time high (ATH) at 1.15 zettahash.

In October, the network came crossed the 1.15 zettahash mark with a peak of ~1.151 zettahash. The network added another 50 exahash (5% network increase from a peak of 1.095 zettahash) in less than a month showing Bitcoin mining companies continue aggressive growth.

From last month: “For context it took Bitcoin ~10 years to reach it’s first 100 exahash from 2009 - 2019. Now 100 exahash can be added in a single month.”

Network hashrate is the cummulative compute power that is powering the Bitcoin network ensuring secure transactions and preventing any malicious actors from adversely affecting the Bitcoin network.

Bitcoin ETFs saw a modest ~$2.5 Billion net inflow for October.

This modest inflow corresponds with the new October all time high, with the slight downtick toward the end of the month. After the Trump China tariff tweet, markets were sent into a short term downward spiral.

Public Company Bitcoin Holdings, October ending at 1,054,428 BTC.

Public companies stacked an additional 15,000 Bitcoin in the last month from 1,039,274 BTC ending in September. Additionally, the floor to enter the top 100 Public company holders went by 19% from 100 last month to now 119 Bitcoin today.

Noteworthy is that Bitplanet is now the 4th South Korean public company to become a Bitcoin Treasury Company as number 99 of top 100 public companies.

From last month: “This entry threshold also only 29 Bitcoin end of July, showing the aggressive accumulation public companies are making toward Bitcoin accumulation.”

That’s all for now.

If there are additional metrics that you want to see or think are appropriate to include, please let me know.

Thanks for reading.