Wintermute said Bitcoin has lost the support of inflows and that altcoins should be viewed cautiously in the near term. According to ChainCatcher, the firm pointed to a Federal Reserve meeting summary showing most officials expected another rate hike this year, with markets pricing about a 20% chance of a hike by the end of October and the U.S. 10-year Treasury yield rising to 5.24%.

It said the S&P 500 rose 1.2% last week to a record high, while crypto markets weakened because equities are supported by expectations for earnings growth and crypto lacks a similar earnings backdrop, making it more dependent on fresh capital inflows.

Wintermute said the reversal in capital flows has made it difficult for crypto assets to extend a six-week outperformance streak. Bitcoin fell from around $86,000 to $87,000 last week, briefly dropped to about $80,400 on Thursday, then rebounded above $83,000 and reclaimed the $82,500 range high.

U.S. spot Bitcoin ETFs recorded about $679 million in net outflows last week, the largest weekly outflow since late June, while Ethereum ETFs saw about $542 million in net outflows.

Wintermute said it would remain constructive only if long-term Treasury yields stabilize and spot ETF flows turn back to net inflows. Until then, it sees Bitcoin as more sensitive to U.S. stock market volatility and carrying higher downside risk, and it does not recommend chasing low-quality altcoins. It added that it would turn cautious if the 30-year Treasury yield breaks above 5.64%, the level reached on September 30, or if Bitcoin continues to face resistance near $82,500. Investors are also watching Wednesday's U.S. September CPI data and earnings from financial institutions and AI-related companies.