Bitcoin holds above US$110K as Fed turns dovish and ETF inflows return

The recent rebound in Bitcoin, now trading above US$110,000, has been driven by a combination of institutional inflows and improving macroeconomic conditions. Spot Bitcoin ETFs have seen renewed demand, with investors treating the recent sell-off as a buying opportunity. As I told The Block, this has helped stabilise sentiment following the largest liquidation event in crypto history, which saw nearly US$19 billion in leveraged positions wiped out.

Additionally, the U.S. Federal Reserve has adopted a more dovish tone. Chair Jerome Powell acknowledged that while growth remains firmer than expected, labour market softness persists. Markets are now pricing in a potential rate cut in October and an early end to quantitative tightening. This shift has eased bond yields and improved the liquidity environment for risk assets, including digital assets.

Resistance and support levels mark Bitcoin’s current consolidation

Bitcoin closed the week near US$108,800 and is currently testing resistance between US$111,700 and US$115,500. A decisive break above US$111,000 could trigger a short squeeze, potentially accelerating upward momentum. On the downside, support is expected around US$106,000, which has held following the recent liquidation-driven lows.

From a technical perspective, Bitcoin remains above its 200-day moving average, a key long-term support level. However, it is still trading below its 50-period and 200-period moving averages on shorter timeframes. RSI readings between 40 and 50 indicate neutral market conditions with a slight bearish bias. Trading volumes have normalised, suggesting a return to more stable market dynamics.

Geopolitical tensions and ETF outflows continue to weigh on sentiment

Yes, several near-term risks remain. Chief among them are geopolitical tensions between the United States and China. The upcoming Trump-Xi meeting carries significant headline risk, particularly if trade rhetoric escalates or new tariffs are introduced. Such developments could trigger renewed volatility across both traditional and digital markets.

In the crypto space, Ethereum ETFs have recorded US$333 million in outflows, reflecting cautious investor sentiment and a rotation into higher-liquidity assets like Bitcoin. Broader altcoin markets remain under pressure, with many top 20 tokens retesting prior lows. These dynamics suggest that while Bitcoin is stabilising, the broader market remains fragile.

Traders eye ETF inflows and macro data for the next directional move

In the short term, traders should closely monitor the US$111,000 resistance level. A breakout above this threshold could confirm a shift in momentum and open the door to further upside. ETF inflow trends will be critical in gauging the strength of institutional conviction.

Macro data will also play a key role. Upcoming U.S. inflation and manufacturing figures, along with Australian employment and retail data, could influence interest rate expectations and broader risk sentiment. These factors will likely determine whether Bitcoin continues to consolidate or begins a new directional move.

For more insights and market analysis, follow me on LinkedIn or X.

Disclaimer: The information provided on this page is issued by BTC Markets Pty Ltd (BTC Markets, we, us, our). The information is general only and is not intended to constitute an opinion or recommendation with respect to its contents. Past performance is not a reliable indicator of future performance. Any reference to past performance is intended to be for general illustrative purposes only. The information cannot be relied upon for any purposes and is not intended to be a substitute for professional advice.

The information does not purport to be complete, accurate or contain all of the information that a person may require to make a decision. It may also contain forward looking statements, which are subject to known and unknown risks, uncertainties, and other factors. We recommend you obtain professional advice before making any decision with respect to the matters discussed in this document. To the maximum extent permitted by law, BTC Markets will have no liability for any loss or liability of any kind: (i) arising in respect of the information contained (or not contained) on this page; or (ii) arising from a person relying on any information or statement contained on this page. The information provided is only intended for recipients in Australia. This information cannot be reproduced without our prior written pemission.