Bitcoin slipped below $80,000 on September 5 as traders braced for next week's US inflation print and a likely European Central Bank rate hike. Short-term holders are moving hundreds of thousands of coins to exchanges, yet ETF inflows continue and Bitfinex says a key weekly indicator just turned bullish.
Bitcoin dropped 1.75% on September 5 to trade at $79,599, slipping below the psychological $80,000 level as investors positioned for the week ahead.
Fed and ECB Decisions Loom Over Bitcoin
A strong US jobs report pushed the odds of a Federal Reserve rate hike at the September 16 FOMC meeting to 59%. Investors now expect the CPI print, due September 11, to hold at 3.4%. Meanwhile, the market is pricing in a 100% chance the ECB raises rates by 25 basis points on September 10. A hawkish rate hike there could push Bitcoin lower because it tends to steer investors away from risk assets.
Short-Term Holders Book Profits as Demand Absorbs the Selling
Even so, Bitcoin ETFs pulled in $174 million on September 4, suggesting institutional demand remains firm despite the hawkish outlook. That inflow came as short-term holders sent 467,000 BTC, worth $35.4 billion, to exchanges since August 17, averaging 27,500 BTC a day — 29% above the prior three-month pace. A previous CoinGape analysis warned the downtrend could extend toward the lower Bollinger band near $75,335. Still, Bitcoin has kept printing higher highs through the selling, a sign demand is absorbing the coins short-term holders are offloading.
Bitfinex Flags a Bullish Weekly Reversal
Against that backdrop, Bitfinex flagged a bullish reversal on Bitcoin's weekly chart: according to Bitfinex, "BTC has flipped its weekly Super Trend bullish for the first time in months." The exchange linked the move to Bitcoin's correlation with gold after Treasury Secretary Scott Bessent announced the US Treasury would double its long-end bond buybacks from September 9 through November 4. Bitfinex advised traders to treat the shift as a signal to open long positions and use the trend line as a trailing stop.
What Happens if the Fed Hikes
Asked about the scenario, an AI chatbot consulted by CryptoPotato said Bitcoin's initial reaction to a hike would likely be a sharp drop, though it would not expect another catastrophic bear-market leg. If the Fed does raise rates at the September 16 meeting, the tool projected an additional 2%-5% decline within ten days, testing the $75,000 support.
Sources: CoinGape, CryptoPotato, Bitcoin.com
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