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November close not optimistic for Bitcoin – where does that leave us?

October was the most profitable month of this year and one of the best months in the last four years regarding Bitcoin returns. Almost 40 % increase during October was a great start to the previous quarter, and many expected the time has come for Bitcoin to break the 100 000 dollar barrier. But November made a stop to that.

Moonvember did not deliver

After the Uptober, which was a creative name given to the October by the cryptocurrency community, many expected Moonvember – November with a huge movement upwards. This was for instance supported by Stock-to-Flow model, which predicted that the price of Bitcoin should close above 98 000 dollars by the end of November. And since all the previous predictions of S2F were correct, there was no reason to doubt the credibility of this course.

Yet, models are only right, until one day they are not. A common saying that describes the attitude that should have also been taken towards the S2F. This model proved right many times in history, and thus it was only a matter of time, when it will be broken. And that is what happened in November.

The monthly candle of November for Bitcoin not only did not deliver the β€œpromised” 98 000 close. It even ended up in red numbers, with a monthly loss of about 7%. That was a bit surprising not only because the S2F model was invalidated, but also because November tends to be one of the most profitable months for Bitcoin. As represented by the table below, only February and October have more green closes than November (with April and July having the same amount – 3 red closes and 6 green ones).

Bitcoin Monthly returns Monthly returns of Bitcoin, Source: bybt.com

Where to go from here?

According to the S2F model, Bitcoin should have closed December above 135 000 dollars. As of now, that does not seem probable. The sentiment in the market is far from optimistic. This can be for instance interpreted by a common indicator in the cryptocurrency world, the Fear & Greed Index. This index represents the current atmosphere or sentiment in the market via measuring volatility, activity on social media, different trends in the market and other indicators.

Fear & Greed Index Current value of Fear & Greed Index, Source: alternative.me

As you can see, the current atmosphere represented by the index is Fear, which is at a value of 32. This is still not an β€œextreme fear,” which we have seen only few days ago with a value of 21, but it is fear nonetheless. And with this kind of sentiment, one can hardly expect the market to be rising. So unless something changes, December might not be the month for Bitcoin to go and β€œattack” the six-digits.

Education and adding Satoshis

That however does not mean that investors or traders should be down. Usually, during the times like these people spend more time on education or they try to understand different concepts or trends in the cryptocurrency world. Some topics that might be worth looking at right now are Metaverse, non-fungible tokens or Layer-2 payment solutions on Bitcoin like Lightning Network. Moreover, it never hurts to add more satoshis and a situation like this is a great chance to do so.

Additionally, even if it does not look the brightest now, it is also far from negative. The market sentiment is not at the same levels as is common for bear market and we have not dropped below any critical support, which still means that as of now, the bull market is intact. It might took longer than people initially believed, but that does not mean that it will not happen.

Marek is a cryptocurrency enthusiast with several years worth of experience in the industry, who has recently completely focused his time and energy on Bitcoin. As a Head of Conte...

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