Key Insights
- Bitcoin price has dropped to $77,530 as the recent rally stalled.
- Kevin Warsh maintained a highly hawkish stance at Jackson Hole.
- Odds of Federal Reserve rate hikes jumped on Polymarket.
Bitcoin price pulled back to $77,530 on Saturday, down from this week’s high of $81,331. This retreat happened after it became highly overbought, pushing more people to start booking profits.
It also happened as ETF outflows followed the first Kevin Warsh statement at the Jackson Hole Symposium.
Bitcoin ETF Inflows Stall
BTC price dropped significantly as investors reacted to the first ETF outflows in over a week. Data shows that ETFs shed over $201 million in outflows. That ended a prolonged period of inflows that added millions of dollars.
ARK’s ARKB ETF shed over $114 million in assets, while VanEck’s HODL lost $13 million. BlackRock’s IBIT shed over $33 million, while Bitwise’s BITB lost over $49 million in assets on Friday.
Still, this is the best month for Bitcoin ETFs, with spot inflows rising by over $3.31 billion. These funds added over $172 million in assets last month. In total, these funds had over $54 billion in cumulative net inflows and now hold $97 billion in assets.
Kevin Warsh Delivered a Hawkish Statement
Spot Bitcoin ETF outflows rose as investors reacted to the first statement by Kevin Warsh at the Jackson Hole Symposium.
He maintained that inflation remained stubbornly high, which may push the Fed to act. As a result, Polymarket and Kalshi data said that odds that the Fed will hike interest rates in December jumped to over 68%.
The latest Personal Consumption Expenditures (PCE) data published by the US confirmed the gradual rise in these odds. This report indicated that the headline and core PCE rose by over 3% last month, remaining above the Fed’s target of 2.0%.
Rising expectations for a Fed rate hike explain why other assets dropped on Friday. Gold dropped to $4,453 from this week’s high of $4,699, while the S&P 500 Index dropped by 25 basis points to 7,711 points. The tech-heavy Nasdaq 100 Index also dropped by over 100 points.
Bitcoin and other risky assets normally underperform the market whenever the Fed is hiking interest rates or hinting it will. In this regard, the next key macro catalyst to watch will be the US nonfarm payroll (NFP) data. This will provide more color on the state of the economy.
Meanwhile, from a policy standpoint, things are not going well, with the odds that the US will pass the CLARITY Act this year falling. According to PolyMarket, odds of the bill becoming law this year dropped to 14%.
The main reason for this is that Democrats have maintained that they will oppose any law that lacks ethical measures. This will prevent President Trump from launching tokens.
Bitcoin Price Prediction: Technical Analysis
The daily chart shows that the BTC price made a strong bullish breakout, reaching its highest level in months. It peaked at $81,331, a notable level since it was the highest swing in May this year. This means that it has found a substantial resistance level.
The coin has also formed a bearish engulfing pattern, a major bearish reversal sign in technical analysis. This pattern often leads to a bearish reversal over time.
On the positive side, Bitcoin has formed a golden cross pattern as the 50-day and 200-day Weighted Moving Averages (WMA). This pattern normally suggests that bulls have prevailed.
Therefore, the coin may see some substantial volatility in the near term and then resume the uptrend. If this happens, Bitcoin may jump to over $90,000 in the coming weeks or months.
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