FX.co ★ Bitcoin catches its breath after rally

Large investors are pouring money into Bitcoin at the fastest pace in nearly a year. BTC/USD has paradoxically retreated from January highs. Ethereum and Solana followed the sector leader downward.

Geopolitics is putting pressure on BTC/USD. Donald Trump rejected Iran's latest offer to open the Strait of Hormuz. Oil rose, and stocks and bonds fell along with digital assets. Risk appetite — investors' willingness to buy risky assets — is melting like ice cream in the heat.

The Federal Reserve is also a headwind for Bitcoin. The regulator already raised the federal funds rate in September. Traders see a meaningful chance of another tightening at the FOMC meeting in October. US Treasury yields are rising, and the Treasury's buybacks have not contained them. Bonds pay interest, but Bitcoin does not. So, higher rates pull buyers away from it.

Capital flows into Bitcoin ETFs

Support for Bitcoin comes from institutional demand. US spot ETFs that buy real tokens attracted about $2.4 billion in the week to September 25. Institutional investors such as banks and pension funds are entering crypto via these specialized ETFs. This was the largest weekly inflow since October 2025, when funds drew more than $2.7 billion. Soon after that, the market collapsed like a house of cards, and the sell?off stretched through much of 2026. By the end of July, ETFs had gathered over $5 billion, then money flowed back out. Net inflows to specialized ETFs year?to?date are now once again approaching $1 billion.

The US Treasury also lent a hand to Bitcoin. After August 19, when the Treasury announced buybacks of long?dated bonds, the cryptocurrency rose roughly 28%. As a result, from July to September it gained more than 40% after a 14% loss in April–July. Bitcoin is heading for its best quarter since late 2024, when Trump's reelection sent it up 47%.

Quarterly performance of Bitcoin

But a record above $126,000 is still far off. The US Senate did not advance the Clarity Act, which was meant to give the crypto industry clear rules. Bitcoin endured that setback and the rate hike without panic, like an experienced boxer taking a hit. DACM calls the recent weakness an expected reaction after a strong rally — confidence among buyers has not disappeared. Ericsenz Capital believes that for a breakout in 2026, Bitcoin will need a favorable macro backdrop.

Personally, I would not confuse a breather with capitulation. Big money rarely enters a market only to leave immediately.

Technically, the daily BTC/USD chart is forming a 1?2?3 reversal pattern. A close below the model's local low at $83,000 would be a trigger for short?term selling. Returns to buying make sense only above $85,000.