Bitcoin steadies above US$108K as institutional flows return

TLDR

• Bitcoin steadies above US$108K after record liquidations as markets rebuild confidence
• ETF inflows and institutional demand help restore balance after extreme volatility
• U.S. Fed tone softens, fuelling expectations for an October rate cut and end to QT
• US-China tensions remain a key market risk ahead of the Trump-Xi meeting
• Altcoins consolidate, with Ethereum ETFs seeing outflows amid selective rotation

Introduction

The digital asset market is finding its footing after a historic liquidation event wiped nearly US$19B in leveraged positions. Bitcoin has since reclaimed ground above US$108K, with renewed institutional inflows helping steady sentiment. Traders are watching whether fresh ETF demand and a softer tone from the U.S. Federal Reserve can sustain this momentum or if volatility will keep risk appetite in check.

Weekly trading stats as of Monday, October 20th at 10:00 AM AEDT, based on data from TradingView in USD.

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Bitcoin steadies above US$108K after record liquidations as markets rebuild confidence

Bitcoin spent the past week rebuilding stability after the largest liquidation event in crypto history wiped nearly US$19B in leveraged positions. The market has since steadied, with Bitcoin reclaiming ground above US$108K after retesting earlier lows. Renewed institutional inflows buoyed sentiment as investors viewed the sell-off as a “buy-the-dip” opportunity.

Bitcoin closed the week around US$108,800, facing resistance between US$111,700 and US$115,500. On the daily chart, Bitcoin continues to hold above its 200-day moving average, a key support level. RSI readings between 40 and 50 suggest neutral conditions with a slight bearish bias, while trading volumes have normalised since the liquidation spike. On shorter timeframes, Bitcoin remains capped below its 50-period and 200-period averages; a move above US$111K could trigger a short squeeze.

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ETF inflows and institutional demand help restore balance after extreme volatility

ETF activity and institutional participation have provided a stabilising force. Although some profit-taking followed the initial rebound, data show steady ETF participation, highlighting continued accumulation on market dips.

Investors have favoured high-liquidity assets such as Bitcoin and Ethereum, signalling a shift from speculative risk-taking to measured positioning - a pattern typical of early-stage recoveries after volatility spikes.

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U.S. Fed tone softens, fuelling expectations for an October rate cut and end to QT

With official US data delayed by the government shutdown, traders relied on central-bank commentary and sentiment surveys. Fed Chair Jerome Powell, speaking at the NABE conference, noted growth remains “somewhat firmer than expected,” though labour softness persists. Markets now anticipate a possible October rate cut and an early end to quantitative tightening (QT).

An October rate cut and end to QT could be the macro spark for risk assets. Bond yields eased, with the US 10-year slipping to 4.03%, while equities stabilised following tariff-driven swings. Together these trends suggest an improving liquidity backdrop for risk assets, including digital currencies.

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US-China tensions remain a key market risk ahead of the Trump-Xi meeting

Trade tensions between the US and China remain unresolved after last week’s tariff shock. While early signs from the Trump administration hint at a softer tone, uncertainty persists ahead of the late-October Trump-Xi meeting.

Markets are watching closely for policy signals, as renewed tariff or export-restriction threats could spark fresh volatility. Headline risk is expected to remain high, with rhetoric likely to drive short-term swings across both traditional and crypto markets.

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Altcoins consolidate, with Ethereum ETFs seeing outflows amid selective rotation

Broader crypto sentiment remains cautious. Global market capitalisation slipped to US$3.69T from early-October highs near US$4.2T as investors rotated into large-cap assets.

Ethereum ETFs recorded US$333M in outflows, while most top 20 coins retested prior lows. Traders continue to favour major tokens as smaller altcoins face renewed selling pressure.

In infrastructure news, a brief PayPal stablecoin minting glitch produced 300 trillion tokens before being corrected, while Ripple’s US$1.25B GTreasury acquisition signalled its expansion into corporate-treasury management - both reflecting the sector’s ongoing maturation.

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What to watch this week

Upcoming US inflation and manufacturing data, along with Australian employment and retail figures, could influence local and global rate expectations.

In crypto, attention remains on Bitcoin’s US$111K ceiling, ETF inflow trends, and Ethereum’s resilience. Liquidity pockets around US$111K and US$106K could define whether consolidation continues or momentum returns.

Closing thoughts 

Crypto markets are finding balance after a historic reset. Institutional participation and improving macro liquidity are helping re-establish stability. As ETF flows and rate expectations evolve, Bitcoin’s consolidation may set the stage for its next directional move.

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