Bitcoin surged towards the $115,000 mark on Thursday after U.S. consumer price index (CPI) data matched expectations, fuelling optimism that the Federal Reserve could move closer to interest rate cuts. The cryptocurrency’s rally, however, has divided traders over whether the momentum will continue or if a correction is imminent.
CPI data triggers market reaction
The August CPI report showed inflation easing in line with forecasts, reinforcing investor hopes that monetary policy could shift towards easing later this year. Bitcoin reacted swiftly, climbing from the $110,000 level and testing resistance around $114,800. Analysts noted that lower inflation reduces pressure on yields and the dollar, providing a favourable environment for risk assets such as cryptocurrencies.
Traders diverge on short-term outlook
Despite the bullish move, sentiment among traders remains split. Some argue that Bitcoin is preparing to break decisively above $115,000, citing growing institutional inflows, spot exchange-traded fund demand, and strong on-chain activity. Others warn that the market is overextended, pointing to thinning liquidity and over-leveraged positions that could trigger a sharp pullback to the $105,000–$108,000 range.
Institutional flows and ETF demand
Spot Bitcoin ETFs in the United States continue to record significant daily inflows, with funds absorbing substantial volumes from retail and institutional investors. This trend has been a critical driver of Bitcoin’s resilience through recent macroeconomic uncertainty. Analysts say sustained ETF demand could cushion potential corrections, though volatility remains high.
Macro backdrop remains key
Beyond CPI, investors are closely watching upcoming U.S. employment and GDP data, which could shape expectations for the Fed’s next move. A dovish pivot would likely provide further upside for Bitcoin, while stronger-than-expected data could spark renewed pressure on risk assets. Broader geopolitical tensions and shifting correlations with equities are also influencing price action.
Outlook
Bitcoin’s path in the coming weeks will depend on whether it can break convincingly above the $115,000 threshold or face another round of profit-taking. With macroeconomic conditions in flux and trader sentiment divided, volatility is expected to remain elevated. For long-term investors, however, the trend towards mainstream adoption continues to underpin bullish arguments.
Newshub Editorial, 12 September 2025
Recent Comments