Bitcoin price in recovery

Today the Bitcoin price has recovered at least $111,000.

This is still a figure lower than the one from which the correction started, but higher than the critical threshold of $110,000.

However, a bit of analysis is needed to truly understand what this recovery  really means.

The Flash-Crash

After reaching the all-time high on October 6th, above $126,000, Bitcoin’s price began a correction. 

To be honest, however, although the correction started the following day, initially it stopped at around $121,000. It is advisable to take this as a reference point for current analyses, and not the anomalous peak over $126,000.

In fact, on Friday the 10th, there was a flash-crash, which in a few hours caused the price to plummet well below the fateful $110.00, so much so that from that day on, a bit of fear spread in the crypto markets. 

For example, the CMC fear and greed index during those days dropped from 58 points (slight enthusiasm) to 30 points (fear). 

However, already on Monday the 13th, at the reopening of traditional markets after the weekend, the price of Bitcoin had already risen to $115,000, with the fear index returning to the neutral zone above 40 points. 

The second correction

However, starting from the following day, a second correction was triggered, which, although it did not mark a peak as deep as the momentary one of the flash-crash, ended up bringing the price of BTC even for a brief moment below $104,000 on Friday the 17th.

If the flash-crash was due to the forced liquidations of leveraged long positions, and thus was very fast but also recovered very quickly, the second correction was more natural, not forced. 

In fact, in this case, the Bitcoin price took three days to drop below $110,000, and then about 24 hours to fall below $104,000.

Most likely there was a flash-crash due to new forced liquidations of leveraged long positions, but it was really contained, as it started right from $108,000 and was recovered in less than six hours. 

However, subsequently, the price had repositioned slightly below $107,000, until yesterday. 

The Rebound

Yesterday, a rebound began that in theory could still be ongoing. 

Initially, the Bitcoin price recovered that famous $108,000 from which the second small flash-crash of Friday the 17th had started, but within eight hours it had already also recovered $109,000.

During this period, however, the key threshold is constituted by those $110,000 that had held for a good five days after the first major flash-crash. However, last night this threshold was also recovered. 

In fact, today within about two hours the price also rose above $111,000, and for now the rebound does not yet seem definitively concluded. 

The important thing is that, at this stage, it continues to stay above at least $110,000.

Dollar and Gold

The formation that occurred in the price of Bitcoin between the first and the 6th of October was, in all respects, a mini-mini-speculative bubble not justified by fundamentals. 

The real reason it exploded is just that, although most likely the trigger came from gold. 

In fact, in those days the price of gold rose above $4,000 for the first time in history, to the point that a mini-bubble was triggered precisely on gold. 

Speculative capital then partially shifted from Bitcoin to gold, causing the mini-mini-bubble on Bitcoin to deflate, and contributing to inflating the mini-bubble on gold. 

Note that on October 14, on one hand, a small decline in the Dollar Index began, while on the other hand, the price of gold rose for the first time in history above $4,100 per ounce. 

The decline of the dollar halted on Friday, at least for now, and this stop seems to have also halted the gold rally, after a new all-time high well beyond $4,300 per ounce. 

Gold and Bitcoin

If the mini-bubble on gold were to burst definitively, although on one hand this might only mean a return of its price around $4,000 per ounce or slightly less, on the other hand, it could also mean a new shift of capital, this time from the gold market to that of Bitcoin. 

Indeed, between yesterday and today it seems that a mini-mini speculative bubble on Bitcoin has started to inflate again, but in a much slower and, in some ways, natural manner compared to what happened on the first of October. 

If indeed the mini-bubble on gold were to burst these days, the speculative capital exiting the gold market and potentially entering the Bitcoin market could fuel this new mini-mini-bubble on BTC. 

It should not be forgotten that in October 2017, when the conditions were in some ways similar, on the 19th of the month the Bitcoin bullrun resumed, precisely with the formation of a new mini-bubble. That mini-bubble also started as a simple mini-mini-bubble, only to then transform into a real mini-bubble that burst in the first decade of November.

However, just before mid-November, the bull run started again for the third time, and at that point, within a few days, a new mini-bubble inflated, which then turned into a real bubble, so much so that by December it even became a large speculative bubble that burst in the second half of the month. 

It is not to be excluded that something similar could happen at the end of 2025 as well.