Market Analysis of Cryptocurrencies: Altcoin ETFs Go Live Following Crypto Bloodbath

This week, several top altcoins saw spot ETFs begin trading on the NASDAQ. However, with the crypto market still reeling from a record-breaking washout and Bitcoin still consolidating, these alts have yet to catch a significant bid. 
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The market might simply be waiting for the dust to settle on a handful of developments happening this week, including the Federal Reserve’s interest rate decision and the largest options expiration in crypto ever.

Don’t Fight the Fed

Later today, the Federal Reserve will reveal if it is going to be lowering the federal fund rate for the second month in a row. Price action around FOMC meetings are especially volatile. Pay close attention to the messaging from Fed Chair Jerome Powell for any dovish or hawkish nuances – these are often more important than the cuts themselves.

The Federal Reserve could cut interest rates again this month
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Bank of American and JP Morgan are also reporting that the Fed may end its Quantitative Tightening program this week. While ending QT doesn’t signal that QE is returning, the end of the program could spark an increase in risk appetite.

AI Job-Displacement Begins

Amazon has announced the layoff of 30,000 employees in one of the largest layoffs in the company’s history. The layoffs are said to free up operating revenue to reinvest towards compute power to drive AI-based activities. 

Amazon’s long-term growth since the dot-com bubble
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The rapid pace at which AI models are proliferating is disrupting traditional employment sooner than expected and faster than anyone is prepared for. And while better revenue with less headcount is good for the short-term growth of a company's bottom line, when there are no workers making enough income to buy the products and services these companies are offering, they’ll have cannibalized their own consumer base. Forward-looking financial markets may begin pricing in this potential shift.

New Altcoin ETFs Launch

One of the most important developments in Bitcoin over the last decade has been the introduction of spot ETFs. Spot ETFs now hold as much as 6% of the already limited BTC supply. The offset in supply versus demand caused prices to rocket to well over $100,000 per coin.

Solana’s RSI is passing above 50 suggesting buy pressure is increasing
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Spot ETFs went live for Litecoin, Solana, and HBAR just yesterday, but thus far price action has been muted. Investors may be waiting to see what happens around the Fed meeting today, or are perhaps waiting for Bitcoin to choose a direction as the primary market driver. Still, spot ETFs represent easier access and increased liquidity for these blue chip altcoins, which should contribute to long-term fundamental growth.

Bitcoin Big Bang Coming?

Bitcoin’s so-called “up-tober” hasn’t panned out per seasonality expectations, and instead saw the largest liquidation event in the history of crypto. Bulls failed to push BTC far beyond all-time highs and bears were unable to capitalize on the flash crash. The resulting October candlestick has formed as a High-Wave Doji, which represents indecision.

Doji represent a pause in the market due to indecision
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This month-long phase of low volatility and indecision, however, may come to an end on Halloween. On October 31, more than $17 billion in Bitcoin and Ethereum options will expire – the largest expiry in history. Options open interest is also at all-time highs. Volatility typically picks up as options begin to reach their expiration. This resumption of volatility could help Bitcoin finally pick a direction to begin trending.

Conclusion

With volatility compressed and investors sitting on the sidelines awaiting clarity from the Fed, markets appear to be coiling for a decisive breakout or breakdown. Whether Bitcoin leads risk assets higher or the AI revolution ushers in a new era of deflation and disruption, one thing is clear — this is not a time for complacency.
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The next week won’t just reveal direction; it may reveal the narrative that drives the rest of the year. Trade top cryptocurrencies at YouHolder today.