Bitcoin rose 1.51 per cent to US$84,055.22 in 24 hours, and Ethereum rose 0.97 per cent to US$2,471.00. The total crypto market cap rose 1.36 per cent. A rebound in technology and AI stock sentiment lifted risk appetite across both assets. Bitcoin showed a 79 per cent correlation with the S&P 500, and its 24-hour correlation with the S&P 500 ETF SPY was 0.79. That shared direction matters. My view is that this rally is real but narrow and derivative-heavy. It supports a cautiously bullish stance, not a conviction breakout call.
The initial driver came from technology and AI sentiment. SpaceX revenue soared 161 per cent, and Super Micro Computer offered positive guidance. Those earnings signals revived broader risk appetite, and that optimism flowed into crypto. Bitcoin’s tight link to the S&P 500 confirms that its short-term direction remains tied to traditional market sentiment, especially around growth and technology narratives.
The next test comes from upcoming earnings at major technology firms such as Meta and Tesla. Those reports could sustain the current mood or reverse it. If you have been reading what I wrote recently, I said to treat technology earnings as a near-term macro input, not background noise.
Bitcoin also received a mechanical push from a short squeeze. The asset saw US$84.26 million in total liquidations over 24 hours, and shorts made up 92 per cent of that amount. Rising prices forced leveraged short sellers to buy back positions, and that forced buying created a feedback loop that accelerated the upward climb.
This matters because derivative market mechanics amplified the rally, not just organic spot demand. That distinction shapes my view. A squeeze can drive a fast climb, but it can also increase volatility and leave the market vulnerable once forced buying runs out.
Watch for sustained high funding rates or a sharp contraction in open interest, either of which could signal the squeeze is running out of fuel. This is more tactical rather than structural. A squeeze can pull price toward resistance, and it can also fade once the forced buying stops. I would give more weight to spot demand than to liquidation data when judging whether the rally can last.
Also Read: Bitcoin at US$82,829: Why a 95% correlation with the S&P 500 should worry long term believers
On price structure, Bitcoin is testing the upper boundary of a well-defined US$80,000 to US$87,000 range. The seven-day simple moving average sits near US$83,100. If Bitcoin holds above that level and breaks US$87,000, it could target US$88,000. A rejection could bring a retest of the US$80,000 support. The near-term triggers are clear.
A daily close above US$84,200 would confirm near-term bullish momentum, while a close below US$82,000 would signal bearish momentum. The key macro trigger is the Federal Reserve’s rate decision on October 28. Bitcoin is consolidating and awaiting a macro catalyst for its next decisive move. I would want a decisive close above US$87,000 after the Fed announcement before treating this as a breakout rather than a range trade.
That plan keeps risk defined because the range gives both sides a clear line in the sand. My humble advice is not to chase the climb into US$87,000 before the Fed meeting, and I would not treat a single close above US$84,200 as proof of a new trend. The central bank decision deserves more weight than one session of price action.
Ethereum has its own supply-side catalyst. On October 20 to 21, Tom Lee’s Bitmine staked an additional 159,728 ETH worth approximately US$390 million. That brought its total staked holdings to about 5.23 million ETH. This action locks a significant portion of supply, reduces potential sell pressure, and signals strong institutional belief in Ethereum as a yield-generating asset. Large long-term holders are actively choosing to earn yield rather than sell.
That provides underlying demand support. The watch point is continued growth in the staking queue, which would indicate sustained demand to lock supply. It gives Ethereum a firmer floor than pure sentiment alone would provide, though a supply lock does not guarantee an immediate breakout.
Ethereum also benefited from the broader market lift. The total crypto market cap rose 1.36 per cent, led by Bitcoin’s 1.51 per cent gain. A rebound in global technology and AI sentiment supported the move, with strong earnings forecasts from companies such as SpaceX helping the mood. Ethereum saw US$47.99 million in liquidations over 24 hours, with shorts comprising the majority.
That suggests a squeeze added momentum. Ethereum did not rise alone. It benefited from a risk-on shift in correlated assets. The key watch point is how US equity markets react to upcoming technology earnings from Meta and Tesla, as those reactions can provide continued correlation cues.
Also Read: Institutional buyers face a massive test at the US$81,000 Bitcoin support level
Ethereum now faces immediate resistance at the psychological US$2,500 level. A sustained break above that level, especially on a daily close, could open the path to the 30-day simple moving average at US$2,579. The scheduled activation of Ethereum’s Hoodi testnet upgrade on October 26 could renew developer and investor focus.
Failure to hold US$2,470 risks a pullback toward the recent low near US$2,380. A daily close above US$2,500 would confirm bullish momentum, while a drop below US$2,380 would signal renewed weakness. My view is that Ethereum needs spot buying volume to accompany a break above US$2,500. Without that volume, a rejection would suggest the rally came primarily from derivatives positioning and short covering.
My overall point of view is cautiously bullish on both assets, with a preference for patience over chasing. Bitcoin’s improved risk sentiment and a derivatives squeeze provided a clear catalyst, but the price stayed within a multi-week range and showed little breakout conviction. Ethereum’s substantial supply lock-up and favourable macro backdrop provide a solid floor, but it must break above US$2,500 to sustain momentum.
The key watch is whether Bitcoin can decisively close above US$87,000 after the Fed’s policy announcement and whether Ethereum can break US$2,500 with rising spot volume. If those conditions fail, both markets risk reverting to range midpoints or retesting support. The data supports a constructive stance, but not complacency. Macro sentiment and spot demand matter more than a short squeeze, and I’d track those most closely.
My stance leans toward selective exposure rather than aggressive accumulation. The data point to a constructive backdrop, but also to fragile momentum. A trader can respect the range, wait for confirmation, and let the Fed decision and spot volume decide the next leg.
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