Bitcoin Stays Above $116K as Fed’s Dovish Bias Ignites Bullish Tides
Bitcoin stays in its three-week rebound, trading above $116,000 as the dovish bias of the Federal Reserve ignites risk-on appetite in markets. The 25-bps rate cut by the Fed, combined with the anticipation of additional easing in 2025, has boosted investors’ confidence, favoring riskier assets such as BTC. Corporate and institutional appetite is strong, with more than $660 million having entered Bitcoin spot ETFs this week and significant corporate buys, such as Strategy’s purchase of 525 BTC. Although on-chain indicators reflect conflicting signs, with retail investors now leading the market, the technical outlook for Bitcoin implies a possible rally to the $120,000 psychological barrier if positive momentum holds. KEY LOOKOUTS • Be on the lookout for any indication of future rate cuts or monetary relaxation, as additional dovish steps may keep supporting BTC’s bullish trend. • Inflows of significant size into Bitcoin ETFs and corporate buying can greatly impact direction in terms of price. • All-important support at $116,000 and resistance around $120,000 will decide whether BTC continues its ascend or gets a correction. • Track whether the market still stays retail-dominated or if the whale action surges, which may cause price whipsaws in a hurry. Bitcoin is still holding firm above $116,000 thanks to the Federal Reserve’s dovish policies and robust institutional appetite. The latest 25-bps rate reduction, along with the anticipation of additional easing in 2025, has fueled risk appetite, which supports Bitcoin and other risky assets. Institutional flows into Bitcoin spot ETFs totaled over $660 million this week, with corporate buy-ins such as Strategy’s addition of 525 BTC backing bullish sentiment. While on-chain metrics indicate mixed signals with retail currently driving market action, the technical indicators of Bitcoin point to a possible rally toward the $120,000 mark if momentum is sustained. Bitcoin remains firm above $116,000 as the Fed’s dovish bias boosts market sentiment. Firm institutional and company buying helps underpin bullish sentiment, with scope to challenge $120,000 if the trend maintains. Cautiously optimistic on-chain signals indicate trader sentiment. • Bitcoin continues its rebound, remaining above $116,000 following three weeks of successive rises. • The Federal Reserve 25-bps rate cut and dovish 2025 guidance underpin risk-on sentiment. • Institutional buying is high, with more than $660 million entering Bitcoin spot ETFs this week. • Corporate buy-ins, such as Strategy’s entry of 525 BTC, support positive market sentiment. • Mixed signals are coming from on-chain metrics, with retail investors now leading the market. • Primary technical levels: support at $116,000 and resistance around $120,000 for the next possible rally. • Market is still cautious, with surprise whale activity or corrections potentially altering the direction of BTC in the short term. Bitcoin remains robust on its momentum, trading above $116,000 as investor sentiment remains upbeat on the back of the Federal Reserve’s recent dovish policy. The Fed’s 25-bps rate cut and forecasts of further easing in 2025 have spurred risk-on activities in markets, favoring not just Bitcoin but other risk assets. Institutional and corporate players are more active, thereby adding much-needed credibility and support to the market. More than $660 million has poured in this week into Bitcoin spot ETFs, an indication of deepening confidence of large-scale investors. BITCOIN DAILY CHART PRICE SOURCE: TradingView Corporate investment in Bitcoin is also strong, with firms such as Strategy and others increasing their holdings of BTC. Strategy alone deposited 525 BTC into its reserves this week, while other companies collectively bought nearly 89 BTC. Also, efforts like NEXT Technology’s SEC filing to raise $500 million, some of which will be used to buy Bitcoin, reflect further incorporation of digital assets into mainstream corporate planning. These are demonstrations of increasing institutional acceptance, again, betokening robust support foundations for Bitcoin within the wider financial landscape. TECHNICAL ANALYSIS Bitcoin is indicating bullish energy as it holds well above the $116,000 level of support. The 60 weekly Relative Strength Index (RSI) shows increasing upward momentum, and the 59 daily RSI shows constant buying pressure. Bitcoin just broke above the 50-day Exponential Moving Average (EMA), which is a sign of ongoing strength, although the weekly MACD still indicates a residual bearish crossover in late August. If BTC maintains its current pace, it may challenge the psychological level around $120,000, while a decline below $116,000 could witness a pullback towards the 50-day EMA at $113,900. FORECAST If Bitcoin is able to sustain the present momentum and institutional inflows persist, BTC may push towards the psychological mark of $120,000 in the short term. Successful break above the level may pave the way towards its all-time high of $124,474, backed by persisting risk-on sentiment and increasing corporate and institutional demand. Retail and institutional buying could continue to fuel bullish momentum. On the flip side, a breach of the $116,000 support level may initiate a pullback towards the 50-day Exponential Moving Average (EMA) around $113,900. Higher whale participation or unexpected market sell-offs might overwhelm selling pressure, which in turn might slow down BTC’s recovery. Traders should be vigilant, with confounding indicators from on-chain metrics putting forward that the market might be subject to near-term volatility in spite of the general bullish trend.
