Bitcoin (BTC) fell 2.4% to $112,438 after
retreating from the $117,000–$120,000 resistance zone and nearly testing the
$107,000–$110,000 support. The
move came despite the Federal Reserve’s supportive decision at its meeting September
17. Central banker decided cut rates by 25 basis points and signal two more
cuts in 2025, one more than were projected in June. This
officially marks the start of a new easing cycle, a fundamentally bullish
signal for crypto markets.
Initially, sentiment was positive. The S&P
500 hit fresh all-time highs, and BTC briefly climbed 1.6% to $117,800,
flirting with a breakout above $120,000. However, Fed Chair Jerome Powell
dampened enthusiasm with unexpectedly hawkish remarks. Instead of a neutral
tone, he reiterated inflation concerns, emphasised the Fed’s independence from
the White House, and warned about labour market risks. Markets read his stance
as excessively tight, possibly more political than policy-driven, recalling
tensions with President Trump. BTC quickly slipped 1.6% to $114,660.
Despite Powell’s words, institutional demand
remains strong. Large investors
purchased another $1.17 billion in Bitcoin ETFs last week, mainly IBIT
(BlackRock), FBTC (Fidelity), and GBTC (Grayscale), after $1.2 billion in
inflows the week prior. This steady accumulation
underscores growing confidence among big money.
Still, volatility
spiked. BTC plunged 3.0% to $111,764 jn Monday in its sharpest sell-off of the
year, triggering $1.7 billion in long liquidations. The
drop was driven less by fundamentals and more by leveraged unwinding. Powell’s
follow-up speech on Tuesday offered little relief. Although he acknowledged softer U.S. business
activity and signalled further cuts ahead, he undercut optimism by remarking
that stock prices were “high”, which is an unusually direct comment for a Fed
Chair, again interpreted as politically charged.
Markets have since stabilised. Equities and
gold resumed their rallies, and BTC has shown signs of recovery. From a
technical standpoint, nothing has changed: $107,000–$110,000 remains firm
support, while $117,000–$120,000 is the key resistance. If institutions
continue buying and BTC breaks above this barrier, the path toward the next
major target at $155,000–$165,000 will reopen.