Bitcoin's 'Octover' Pattern Breaks Amid Shifts in Oil, Bonds, and AI; What Changed?

Bitcoin (BTC) lost about 7% of its value in October, breaking the well-known bullish and seasonal pattern referred to as 'Octover.' This decline coincided with a weakening of trades related to the artificial intelligence (AI) sector.

Meanwhile, the price of oil futures increased; however, U.S. Treasury yields fell, breaking the 80% correlation that had been observed between these two markets throughout the year. On the other hand, Bitcoin dropped about 4% late Thursday, just hours before a sell-off on Friday in the Nasdaq index, coinciding with the historic hack of the Binance exchange.

Why Are Oil and Bonds No Longer Moving in Sync?

Jeffrey Rosenberg, Chief Portfolio Manager at BlackRock, attributes the root of this disconnect to the stocks of AI companies. The stocks of the so-called Magnificent Seven, which are the largest U.S. companies related to AI, retreated during October.

Rosenberg stated in an interview with CNBC: "In the market's mind, geopolitical risks are secondary to AI risks."

In his view, markets now perceive weakness in the AI sector as a warning for U.S. economic growth. This has led to a decrease in Treasury yields even with rising oil prices. Rosenberg describes the GDP growth in the third quarter as strong and reliant on AI, with business investment increasing by 12.7%, marking the largest growth since 2011, excluding the pandemic period.

However, Kevin Warsh, a Federal Reserve official, disagreed with this view on Wednesday, claiming that capital expenditures are expanding beyond just a few limited sectors. Warsh also cited rising oil prices as one of the key factors in the central bank's battle against inflation. By mid-October, amid rising speculation about the Federal Reserve's tightening policies, the futures market for interest rates indicated a likelihood of a rate hike in December. Meanwhile, Google’s stock recorded its largest one-day drop in history last week, losing about $500 billion in market value.

Does Bitcoin's 'Octover' Still Matter in an AI-Driven Market?

Data shows that historically, by the end of 2025, Bitcoin has risen in 10 out of 13 Octobers, with a median return of nearly 15%. Given that October 2025 also ended with a price decline, the drop in Bitcoin's price in 2026 marks the second consecutive bearish October, with BTC now trading below $80,000.

In contrast, Microsoft has returned to the public bond market after nearly a decade. Credit Default Swap (CDS) spreads, which price insurance against debt default, are around 55 basis points for Microsoft and nearly 300 basis points for Oracle.

Rosenberg believes that the bond market could absorb $4 trillion in projected AI-related debt over the next four years; however, the cost of this will be a decrease in bond prices and an increase in spreads. If such supply enters the market, the development of AI infrastructure will not only affect stock market sentiment but will also be at the center of bond market pricing.

This content is provided for general informational purposes only and doesn't constitute financial, investment, legal, or tax advice. Any events, rewards, online promotions, or related information mentioned herein should not be considered a recommendation, solicitation, or invitation to purchase, sell, trade, or otherwise deal in any crypto assets. Crypto assets are highly volatile and may result in loss. The availability of WEEX services, products, and related events may vary by region. You are responsible for ensuring that your participation is in accordance with applicable local laws and regulations.