Bitcoin came under renewed selling pressure on Thursday as hotter-than-expected US inflation figures raised concerns about tighter monetary policy, while heavy liquidations and weaker institutional demand added to the cryptocurrency’s losses.
The world’s largest cryptocurrency fell below the $81,000 mark overnight, touching a low of $80,639. It later recovered some ground but remained under pressure. At the time of writing, Bitcoin was trading at $81,286.34, down $303, or 0.37 percent. Earlier in the day, it had declined 0.99 percent to $81,015.
The latest US inflation data added to investor concerns that the Federal Reserve may have less room to ease monetary policy. Higher interest rates tend to weigh on riskier assets, including cryptocurrencies, by making safer investments more attractive.
Bitcoin’s decline was also fuelled by forced liquidations, with $63.17 million in long positions wiped out over the past 24 hours. These liquidations occur when traders who bet on rising prices are forced to close their positions, often adding to downward pressure.
The cryptocurrency also slipped below the $82,000 to $83,000 support range, a level that had helped underpin its price. A sustained break below such levels can unsettle traders and encourage further selling.
Institutional demand has offered little support. Bitcoin exchange-traded funds (ETFs) have recorded net outflows since late September, signalling weaker appetite among investors using these products to gain exposure to the cryptocurrency.
Still, the recent pullback has not ruled out a recovery. According to analysis on TradingView, Bitcoin could move towards $88,000 if buying momentum returns, with a further advance towards $93,000 possible if the rebound gathers strength. These remain potential targets rather than confirmed price movements.
Some analysts have also drawn comparisons between Bitcoin’s current market pattern and its performance in 2023. During that period, the cryptocurrency gained about 40 percent after its 50-day simple moving average crossed above its 200-day average, a technical signal commonly known as a golden cross.
However, a similar outcome is far from guaranteed. Bitcoin would need renewed buying interest and a stronger price recovery for the comparison to carry weight.
Another market indicator is offering a potentially more encouraging signal. The Bitcoin Exchange Whale Ratio, which tracks the share of exchange inflows attributable to large transactions, has declined steadily over the past week. The move may suggest that large holders are becoming less inclined to send Bitcoin to exchanges for potential sale, although the indicator alone cannot confirm their intentions.
The immediate pressure on the market, however, stems from the latest US inflation figures.
The US Bureau of Labor Statistics reported on October 14 that the Consumer Price Index (CPI) rose 0.6 percent month-on-month in September, up from 0.4 percent in August. Annual headline inflation accelerated to 3.7 percent from 3.4 percent.
Core CPI, which excludes food and energy prices, increased 0.3 percent during the month and 2.6 percent from a year earlier.
Energy costs were a major contributor to the rise. The energy index climbed 5.2 percent in September, while petrol prices surged 9.1 percent, adding to the pressure on household budgets and the broader inflation outlook.
For Bitcoin, the figures have created a familiar problem: hopes of a price recovery are competing with concerns that interest rates may remain restrictive for longer. Until investors gain greater clarity on the Federal Reserve’s next move, the cryptocurrency is likely to remain sensitive to economic data, market positioning and changes in institutional demand.
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