This round of decline, the selling pressure does not seem so "proactive".

On October 8, Bitcoin fell to around $80,000, marking about a month low and about an 8% drop from the roughly $87,000 high tested on October 2. Ethereum and Solana declined even more. The timing is also striking: in just two days, it will be the one-year anniversary of the flash crash on October 10, 2025. On that day, Bitcoin dropped from about $122,000 to around $105,000, a significant portion occurring within minutes.

The direct impetus this time is clearly stated in the public data. Brent crude oil spiked above $100 due to a tanker attack, the yield on ten-year U.S. Treasury bonds touched about 5.35%, the dollar was strong, and the September interest rate meeting minutes were hawkish. Risk assets were first compressed by the discount rate. Then came the leverage. Around October 7, approximately $550 million was liquidated across the market, with around $487 million being long positions; by October 8, the 24-hour liquidation reached about $1 billion, mostly from long positions. Some analysts estimated that long liquidations within the first 12 hours amounted to about $400 million. Once the price broke, exchanges liquidated long positions as per their rules, and the liquidation of long positions turned into sell orders.

"This is a decline without a particularly noticeable sell-off." This statement is half true and cannot be taken in its entirety.

The truthful half is: the acceleration phase is unlike a panic sell-off. The funding rate this week was mostly far below the crowded levels seen before October 10 last year, rarely reaching an annualized rate above 8%, and even turning negative on occasion. There have been readings indicating a decrease in Bitcoin supply on exchanges, suggesting not everyone was rushing to deposit coins to sell. Many traders in the community also characterized this wave as a leveraged liquidation rather than the main players and whales admitting defeat in the spot market.

The untrue half is: the sell orders did not disappear. According to CryptoQuant data, holders realized approximately 25,700 Bitcoin in profits last week, marking the largest profit-taking of this year; the unrealized profit ratio once reached about 33%, the highest since December 2024. The U.S. spot Bitcoin ETF saw about $487 million in net outflows on October 7, one of the largest single-day outflows since June, with BlackRock's IBIT accounting for about $208 million. Money withdrawn from brokerage accounts and whether on-chain whales were selling are two separate matters.

Therefore, a more accurate way to describe this round of decline is: macro factors compressed risk appetite, profit-taking and ETF redemptions provided direction in the spot market, and leveraged longs turned the decline into a stepwise motion. There was neither a "mysterious main player clearing everything overnight" nor was there "no one selling at all."

On social media and X, it’s actually the same table with two sides arguing

The hot posts on Binance Square, OKX community, and X in recent days can be roughly divided into two factions.

One faction is focused on whales and ETFs. Four new wallets deposited around 1 million USDC into Hyperliquid and opened short positions of about 148 Bitcoin with 40x leverage, followed by a price drop, interpreted as "someone knew beforehand." The transfer of approximately 12,000 Bitcoin related to the U.S. government and Bitfinex but not entering exchanges was interpreted as "not sold yet." High position trading in Ethereum by a significant trader that transformed from floating profit to floating loss was viewed as "having more money does not guarantee being on the right direction."

The other faction focuses on charts. Previous lows being broken, long liquidations not yet completed, not chasing shorts, waiting for a bottom to see support. Moving averages, open contracts, and funding rates are being used as explanations for the next candlestick.

Both factions missed a point. Whale money can push a needle, but cannot push an entire trend without spot buy orders—Bitfinex noted at the beginning of October that the spike on October 2 was mainly driven by futures without spot increasing to follow, hence the rally could not be sustained. Technical indicators can tell you about crowding and breakdowns, but cannot decide whether you should keep exiting after losing all your money. The contention between funds and technology is not about who wins the championship, but about division of labor.

Funds are the ticket, rules are the score

Funds are the entry ticket. Without capital, rules cannot be enforced. The larger the ticket purchased, the greater the absolute loss from a single mistake. Many of the longs liquidated this week were not completely on the wrong side, but the positions were so large that with just a few percentage points of price movement, margin requirements were insufficient.

Technology is the core of profitability. The technology here is not just adding another line; it consists of three written elements: under what conditions to enter, under what conditions to exit, and how much to lose if wrong. Ability sets the ceiling, not scale. Richard Dennis' turtle experiment taught the same set of breakout and stop-loss strategies to individuals without trading backgrounds, leading some of them to earn significant absolute profits later on. The rules are the same, but the results still differ, with the divergence stemming from execution. Jesse Livermore earned epoch-making money twice from reading the market, but later when he expanded scale in violation of rules, the profits reversed. Scaling up is the result, not the judgment.

Classic case: a 200-day moving average, sufficient for beginners to study for an entire year

Beginners do not need ten indicators. Breaking down the 200-day moving average used by Paul Tudor Jones is enough to establish the first strategy.

The rules can be summarized in three fixed statements.

First, only hold or buy when the closing price is above the 200-day moving average. The moving average uses the average of the closing prices over the latest 200 trading days; since the cryptocurrency market does not close, use the closing prices of the latest 200 daily candlesticks.

Second, when the closing price falls below the moving average, reduce or exit the position at the next opening without discussing "it will return."

Third, each single transaction is only allowed to lose 1%-2% of the total capital. If price volatility is high, reduce the quantity and do not increase the loss ratio.

Tudor Jones used this line and combined it with the 1929 chart in 1987. The Dow Jones was already below the 200-day moving average before the crash, and he was positioned close to being flat near the high point, establishing a short position using S&P futures. On October 19, the Dow dropped 22.6% in a single day. He later told Tony Robbins that the value of the 200-day moving average rule is that it prompts exits and promotes defensive strategies; that one line is worth an entire business school. That year, his fund returned over 200%. Note that he did not predict the 22%; rather, the moving average kept him from staying long before he correctly predicted it. Predictions can be wrong, but rules limit the cost of mistakes.

The same line applied to Bitcoin allows beginners to directly compare without having to first learn Elliott waves.

In November 2021, Bitcoin peaked at about $69,000. After that, the price attempted to recover multiple times, but at the moment when the daily closing price fell below the 200-day moving average, the rule mandated reducing the position, rather than treating "a pullback as a buying opportunity." After failing again in January 2022, the price took over half a year to reach the $15,000-$20,000 range. Those following the rules would exit their long positions halfway down; those who acted on instinct often added at $50,000, $40,000, and $30,000, turning their entry tickets into deep positions. Those with more capital who simultaneously opened high leverage positions would find their exits turning into forced sell orders by exchanges, illustrating that the difference between 2022 and this week lies only in the magnitude, not in structure.

The flash crash on October 10, 2025, serves as a counterexample. Before the crash, the funding rate once annualized at around 30%, and open contracts approached extreme levels, while the order book thinned over the weekend. The 200-day moving average was then well below the price; it will not tell you to sell at the top within minutes; what it can do is prevent you from turning all spare cash into 10x long positions at already crowded rates. The funding rates this week were nowhere near as extreme, but long liquidations remained amplifiers of the decline. The rules protect against "fully leveraged positions" rather than "always buying at the bottom."

Beginners can write this strategy down on an executable card.

Only the spot Bitcoin should be selected, not contracts.

Every two weeks, check if the daily closing is above the 200-day moving average. If above and you have spare cash planned, invest a small amount; if below, stop buying and reduce existing positions to a proportion that allows you to sleep.

Single purchases should not exceed 10% of total spare cash, and the overall position should not exceed 50% of the spare cash, keeping the rest in stablecoins. This way, even if the moving average is a false breakout, losses are capped by the position.

Each week, keep three lines: closing price, position of the moving average, and what you did. If mistakes are made, review only "did it violate the rules," not "if I could have guessed the lowest point."

This is not the optimal strategy, but a learnable strategy. It shifts the technical understanding from "chart feelings" to "comparing closing prices against an average line," and funds from "all-in" to "only a part of the ticket." Tudor Jones used it defensively, and turtles used fixed stop-losses to achieve the same objective. Beginners should first focus on defense before discussing whether to add a second set of rules.

If you want to learn while doing, start by executing the rules with a small order

The rules do not mean just going through the motions in your account; they remain theoretical.

Binance's spot order book is usually the thickest, suitable for using a very small amount of Bitcoin spot to implement "buy only when above the moving average, stop when below," and in qualifying regions, you can also see stock receipts in the same account, but that is next lesson. OKX's unified account integrates spot and contract margins on a single interface, allowing for easy comparison of funding rates and holdings, appropriate for those already able to execute spot rules but wishing to understand funding rates with simulated or very small positions.

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Complete verification first, then deposit an amount that you can afford to lose without impacting next month’s expenses in stablecoins. Contracts are another layer of risk. This week has already demonstrated: the direction is not completely wrong, and leverage can nonetheless lead to your liquidation first.

Funds allow you to enter the market, while technologies like the 200-day moving average influence whether you can retain your entry ticket. There was no mysterious crash in this round of decline; rather, there were macro factors, profit-taking, ETF redemptions, and selling pressure from leveraged positions themselves. Learning when a single line prompts you to stop trading is closer to a repeatable transaction than guessing tomorrow's lowest point.

Risk disclaimer at the end: does not constitute investment advice; may lose all principal; comply with local laws; do not use leverage, loans, or living expenses to participate.

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