Bitcoin surged 24% in August, marking its strongest monthly gain since November 2024. After the sharp rally, the cryptocurrency stabilized near $78,000 as high oil prices and rising U.S. Treasury yields limited further upside.
At the same time, expectations for a September interest rate hike increased significantly following Federal Reserve Chairman Kevin Warsh’s speech in Jackson Hole. Despite the more hawkish outlook from the Fed, analysts say Bitcoin continues to hold key support levels.
Bitcoin Holds Critical Support at $77,100
According to Bitfinex analysts, Bitcoin is holding its critical support level at $77,100 despite signals that the Federal Reserve may pursue a more hawkish monetary policy.
Bitfinex’s latest Alpha report said Bitcoin experienced a sharp pullback last week after climbing to $81,500 following Kevin Warsh’s remarks at Jackson Hole. However, Bitcoin’s ability to remain above $77,100 suggests that the broader uptrend has not yet been broken.
Spot Bitcoin Buying Supports the Rally
Bitfinex analysts said Bitcoin’s August surge was not driven solely by leveraged trading. Actual purchases in the spot market also contributed to the cryptocurrency’s rise.
U.S. spot Bitcoin ETFs recorded total net inflows of $924.5 million during the week of August 24-28. Bitfinex said liquidity concentrated in ETFs and stablecoins is supporting the Bitcoin and broader crypto market uptrend, although high inflation and expectations of future interest rate hikes could restrict additional gains.
U.S. employment data due on September 4 and inflation data scheduled for September 11 are expected to be important for market expectations surrounding the Federal Reserve’s September interest rate decision.
Can Bitcoin Hold Above $80,000?
Bitcoin fell below $80,000 after Kevin Warsh’s hawkish speech at Jackson Hole but has continued to hold the $77,100 support level.
Questions remain over whether Bitcoin can sustain a move above $80,000. Bitfinex points to strong spot Bitcoin demand and approximately $925 million in net inflows into spot Bitcoin ETFs as factors supporting the market. However, some analysts remain cautious about the durability of the rally.
Greeks.live analyst Adam said ETFs had recorded large inflows, but the strong inflow streak ended with a $202 million outflow on August 28. The analyst warned that continued ETF outflows, and the possibility that they could become permanent, may make it more difficult for Bitcoin to remain above $80,000.
The analyst also discussed Strategy’s decision to resume Bitcoin purchases after a long pause. According to the analyst, Strategy’s purchases could support the price in the short term but may not be sufficient on their own to alter the long-term trend.
Macroeconomic Risks Remain
The analyst said the Federal Reserve’s hawkish stance and broader macroeconomic uncertainty remain among the main risks facing Bitcoin, echoing concerns raised by Bitfinex.
These factors are putting additional pressure on investor confidence and the Bitcoin price. The analyst believes it is too early to describe the market as a new strong bull trend without a sustained move above $80,000. ETF flows and Federal Reserve policy are likely to play a decisive role in determining Bitcoin’s short-term direction.
This is not investment advice.
