Crypto market cools after strong ETF inflows; traders await Fed clarity amid data delays
Bitcoin (BTC) fell back below a critical support zone near $123,000, following a sharp rally that pushed the leading cryptocurrency to multi-month highs earlier this week. The pullback comes as the U.S. dollar index (DXY) regained strength ahead of Federal Reserve Chair Jerome Powellâs scheduled remarks, with investors watching closely for any signals on future monetary tightening.
The latest 4-hour chart shows Bitcoin testing the $122,000â$120,000 range, an area that previously served as a strong breakout zone. After a steep climb out of a descending channel pattern in late September, BTC hit resistance just under $124,000, forming a short-term supply zone marked by profit-taking and reduced momentum.
BITX Analysts point to $120,000 as the next key level to hold. âBitcoinâs reaction to this zone will define whether the recent breakout is sustainable,â said one of BITX market analyst. âA decisive move below $120K could invite a deeper correction toward the $117Kâ$115K range, where institutional bids were last observed.â
The broader crypto market is also experiencing a mild retracement. Major altcoins like Ethereum and Solana saw similar declines, mirroring Bitcoinâs pause. Despite this, on-chain data still shows consistent inflows into spot Bitcoin ETFs, a sign that institutional demand remains resilient.
âThe underlying sentiment is still constructive,â noted  BITX strategist. âHowever, macro uncertainty is back in focus, especially with Powellâs upcoming speech and the ongoing data gap caused by the partial government shutdown.â
Bitcoinâs immediate trend remains tied to the U.S. dollarâs performance and market expectations for the Fedâs policy path. If Powell hints at prolonged rate pressure, risk assetsâincluding cryptoâcould see further consolidation.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.