BTC has declined for five consecutive weeks.
The current price is around $74,100, having dropped approximately 13.5% over the past five weeks. Last week, the U.S. non-farm employment data significantly exceeded expectations, raising concerns in the market about the Federal Reserve's interest rate hike in December. Tomorrow (November 10), the U.S. will also announce the October CPI.
The continuous decline, rising expectations for interest rate hikes, and the impending CPI announcement indicate that market pressure has not yet subsided.
However, there is one noteworthy aspect of this drop: it has fallen for five weeks with a cumulative decline of about 13.5%, which is not particularly large compared to significant pullbacks in previous bear markets.
Some believe this is just a repeated washout in the early stages of a bull market, while others are worried that the bear market is not yet over.
Which possibility is more likely? Observing the current chip distribution of BTC may provide some clues.
1. Non-farm data exceeds expectations, concerns about December rate hike increase
The U.S. October non-farm data released last week was significantly stronger than the market expected.
U.S. non-farm employment rose by 165,000, far exceeding the anticipated 65,000; the unemployment rate dropped to 4.1%, and the number of jobs added in September was also revised up to 60,000.
The job market remains resilient, so there is naturally less urgency for the Federal Reserve to cut interest rates.
After the data was released, the interest rate futures market quickly adjusted, with traders beginning to increase bets on the Federal Reserve's rate hike in December. The U.S. dollar and Treasury yield have also become key variables to watch in the market going forward.
This is not good news for BTC. Expectations of higher interest rates usually lead to a reassessment of the valuation of risk assets, and the crypto market is also prone to similar impacts.
Tomorrow's CPI is another test. If inflation does not decrease, concerns over the Federal Reserve maintaining a tight policy may further intensify.
2. Five consecutive weekly declines, how is this different from the past?
First, look at the weekly chart.
BTC has now seen five consecutive weeks of declines, with a cumulative drop of about 13.5%.
Compared to previous market cycles, such continuous declines do not necessarily occur only in bear markets, but in typical bear market phases, the five-week pullback has been significantly larger:
- 2011: Five weeks down about 30%;
- 2014: Multiple five-week declines, ranging from about 24% to 35%;
- 2018: Five weeks down about 38%;
- 2022: Five weeks down about 18%;
- January 2026: Five weeks down about 28%.
This time, the drop is only about 13.5%, which is relatively mild.
Some also compare this move to the adjustments in the summer of 2023. At that time, BTC also experienced a period of repeated fluctuations during an upward trend, with market sentiment not being optimistic, but the market subsequently strengthened.
Thus, there are currently two different views in the market: one believes the bear market is still ongoing, while the other considers this just an adjustment in the early stages of a bull market.
I tend to not rush to categorize the market. Five consecutive weekly declines do indicate market weakness, but the number of consecutive weeks and the extent of the drop alone are insufficient to determine a bull or bear transition. The ability to see a sustained rebound and whether spot funds are re-entering the market are more important than just comparing historical declines.
3. Scarce chips below BTC, will it decline faster?
Next, let’s look at the current chip distribution.
Since the rebound from the low point in early July this year, BTC has gradually formed two prominent chip peaks:
- Near $62,987: The main chip peak below, where historical trading is relatively concentrated.
- Near $77,493: Another chip peak above, which has also seen considerable historical trading volume.
- $67,000 - $75,000: Between the two chip peaks, historical trading is relatively sparse.
At the current price of about $74,100, BTC is in this sparse trading range.
This raises a question: if the price continues to decline, is there sufficient support in between?
Chip peaks can reflect where significant trading occurred in the past but cannot be directly equated to current buying pressure. When prices drop back to these areas, previous buyers may choose to increase their holdings or they may opt to cut losses and exit.
In areas with relatively low historical trading, the accumulated cost support is not as dense.
If selling increases and there are no new buyers stepping in, the price may indeed cross this area more quickly.
The chip peak near $63,000 is a noteworthy area, but it does not mean that BTC will inevitably drop to that level. New funds may emerge to support the market at any time, so relying solely on historical chips to determine price bottoms is not sufficient.
4. Tomorrow's CPI, how to interpret three possible outcomes?
After the CPI release, we can focus on three scenarios.
1. Above expectations: BTC pressure may continue to increase
If inflation does not cool down, concerns about the Federal Reserve maintaining tight policies may further intensify.
If the U.S. dollar and Treasury yields strengthen simultaneously, risk assets may continue to be pressured. For BTC, the current chip structure is not favorable, and if selling pressure rises, the price may quickly drop through the sparsely traded area.
2. Meeting expectations: the market may not improve immediately
Meeting expectations does not mean the market will immediately rebound.
The previous non-farm data has already heightened rate hike expectations, and if the CPI only meets expectations, it may not be enough to shift the market back to optimism. BTC may remain in a low position, waiting for funds to provide clearer direction.
3. Below expectations: short-term recovery may be expected
If inflation clearly cools, concerns about rate hikes may ease, and the U.S. dollar and Treasury yields may have a chance to retreat.
This would be a relatively positive signal for BTC. However, whether the rebound after the announcement can be sustained will depend on spot trading volume and ETF fund flows. If it is solely driven by short-term sentiment, and subsequent funds do not follow, the market may also quickly retreat.
5. What to focus on next?
The current situation for BTC is not easy.
Five consecutive weekly declines indicate weak buying pressure; the non-farm data exceeding expectations has reignited rate hike concerns; and the chip distribution shows that there is a zone of sparse historical trading below the current price.
If the CPI continues to be hot, increased selling pressure may mean that BTC could lack sufficient dense historical cost support during declines.
However, if the CPI cools and spot funds re-enter the market, this sparse chip zone may not necessarily become a downward channel.
Therefore, I believe it is not yet appropriate to simply declare that the bull market has ended or to interpret five consecutive declines purely as washouts.
After the CPI announcement tomorrow, first watch how the market reacts and then see if BTC can stop its decline. Confirming whether there is real buying pressure returning is more important than speculating between bulls and bears.
During periods of market fluctuation, aside from focusing on the price, it’s also worthwhile to consider the arrangement of idle funds. Recently, both Binance and AiCoin have some platform activities that those interested can look into.
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Risk Warning: Digital assets and related financial products carry market risks; activity returns and rewards are subject to official rules. Please fully understand the product terms and make prudent decisions based on your own risk tolerance before participating. This article is only for market information organization and analysis and does not constitute investment advice.
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