Key Takeaways
- Bitcoin dropped to $107K as retail investors retreat and network activity declines.
- Active addresses fell 26%, limiting liquidity and delaying market cycles.
- Institutional demand lags behind newly mined BTC, creating downward pressure.
Bitcoin Faces Early November Decline
Bitcoin (BTC) started November with a 2% drop, slipping back to $107,000 as retail investors pull back. After reaching all-time highs of $126,200 in October, BTC’s weekend gains evaporated, hinting at a potential test of support levels around $101,150. Analysts warn that the market may be entering a range-bound phase, with downside liquidity growing and retail participation declining.
Also Read: Bitcoin Falls Below $103K as Dogecoin, XRP, and Solana Lead Crypto Market Decline
Retail Exodus and Network Weakness
On-chain analytics highlight a steep retreat among retail investors. Active Bitcoin addresses fell 26.1% from 1.18 million in early November 2024 to 872,000, according to CryptoQuant. Analysts suggest this reduction limits network activity and delays natural market cycle corrections. Metcalfe’s Law, which measures network value relative to size, indicates Bitcoin may be overvalued, signaling a potential pullback to $98,500.
Also Read: Bitcoin Hits $102K: Whales Accumulate While Retail Investors Sell Off
Institutional Demand Falls Below Supply
Institutional appetite has also weakened. For the first time in seven months, net institutional buying—including US spot Bitcoin ETFs—dropped below newly mined BTC supply. This trend, highlighted by Capriole Investments, underscores the challenges for price recovery, as institutional flows fail to offset ongoing market dilution.
Macro Factors Add Pressure
Bitcoin’s correlation with traditional assets is shifting. While US-China trade optimism boosts stock markets, crypto lags behind amid renewed Fed rate-cut concerns. CME Group data shows only a 63% probability of a December Fed rate cut, and quantitative tightening has slowed, yet liquidity support remains limited. Analysts note that Bitcoin now moves mostly with tech stocks rather than the broader market, reducing macro hedges.
Conclusion
As Bitcoin begins November under pressure, both retail and institutional activity indicate a potential near-term correction. Traders should monitor support levels around $101K and $98.5K while factoring in macroeconomic signals. For market participants, understanding liquidity flows and network health will be critical in navigating this volatile environment.
