Bitcoin Falls to $81,000 After Hot Inflation Data
Bitcoin drops to $81,000 after hot US inflation data; Ether falls 6 percent. Rate-hike fears and liquidations weigh on crypto.
Bitcoin Falls to $81,000 as Inflation Revives Rate-Hike Fears
Key Takeaways
- Bitcoin slides to about $81,000 after a hot US inflation report.
- Ether drops more than 6 percent; futures liquidations approach $1 billion.
- Odds of an October Fed rate hike swing between 26 and 50 percent.
Bitcoin (BTC) trades around $81,000 after the September inflation report and briefly touched the $80,000 mark. The price is down roughly 3 percent over 24 hours. Ether (ETH) takes a much harder hit, falling more than 6 percent to about $2,350.
A Price Report That Flips Rate Expectations
US consumer prices ran 3.7 percent above a year earlier in September, up from 3.4 percent in August. Core inflation, which strips out energy and food, rose from 2.4 to 2.6 percent. Both readings missed economists' expectations, as Omkar Godbole reports at CoinDesk.
Betting markets reacted fast. On Polymarket, the probability of a Federal Reserve rate hike in October jumped to nearly 50 percent before settling near 30 percent. The CME's FedWatch tool first showed almost 47 percent, then only 26 percent. Futures still price an unchanged policy rate at more than 70 percent.
Ledn analyst Thomas Wu tells The Block that a 0.3 percent monthly rise in core prices puts an October hike back on the table after a weak jobs report.
Leverage Amplifies the Sell-Off
Derivatives markets showed how many traders had bet on higher prices. Based on CoinGlass data analyzed by Shaurya Malwa at CoinDesk, roughly $483 million in futures positions across Bitcoin and Ether were force-closed, about $286 million of it in Ether. Across all coins, the article's headline cites nearly $1 billion. XRP and Solana lost about 5 percent, Dogecoin around 6 percent and Zcash 13 percent.
Ether suffers more because its futures market, with about $30 billion in open interest, is far smaller than Bitcoin's roughly $52 billion. The same sell orders move the price more there.
Fund money is retreating too. US spot Bitcoin ETFs recorded outflows of $150.5 million on October 14, a day after $175.7 million flowed in. Asia added pressure: South Korea's Kospi plunged 8 percent and triggered trading halts, while Nasdaq futures sat about 1 percent lower.
How Far Can It Fall?
Opinions differ. Paul Howard of Wincent expects a short-term range between $80,000 and $88,000. If Bitcoin breaks below, the path toward $75,000 opens. Matt Mena of 21Shares disagrees: much of the weakness was already priced in last week, when the price tested support at $81,000 to $82,000. He sees room for a rebound above $85,000.
Bottom line: in the coming days the Fed outlook matters more than anything in crypto itself. As long as rate-hike fears persist, a stronger dollar and higher yields remain the biggest obstacle for risk assets.
What momentum says
Momentum signals weakness on short and medium timeframes: the 1-hour, 4-hour and 1-day readings are all bearish, at a price of $81,100 when captured. Only the weekly chart stays bullish. The broader trend is intact, but the latest move runs against it.
Scenarios
If Bitcoin holds the zone around $80,000, stabilization within the range up to $88,000 cited by Howard is possible. Only a recovery of $85,000 would support Mena's rebound thesis.
If $80,000 breaks decisively, Howard sees the zone near $75,000 coming into view. More liquidations of leveraged long positions could accelerate the move.