Bitcoin retreats under $86,000 as ETF outflows slow rally

Highlights

• Bitcoin fell under $86,000 on Tuesday after rallying more than 12% over three straight weekly gains.
• U.S. spot bitcoin ETFs saw $90 million in outflows on Monday, contrasting with the previous week's large inflows.
• Resistance for bitcoin is at $87,599 and around $90,000, with $85,000 acting as immediate support.

Bitcoin steadies following three-week rally

On Tuesday, bitcoin remained under $86,000, maintaining a recovery exceeding 12% from mid-September, buoyed by ETF demand and changing rate expectations.

The digital asset has posted three straight weekly rises and now nears resistance that may decide if its rally can reach $90,000.

Technical indicators on daily and weekly timeframes still appear bullish. But daily momentum measures have softened, pointing to a period of consolidation near recent peaks rather than a steady ascent.

Keeping support at $85,000 would help sustain the bullish outlook. A drop below that level could signal a more significant pullback.

Last week, U.S. spot bitcoin ETFs attracted $241.09 million in net inflows, per SoSoValue.

That marked a third straight week of positive flows, indicating demand for these funds persisted as bitcoin's price recovered.

But the week started on a down note: these funds saw $90 million in outflows on Monday.

Consistent inflows create a favorable environment, but they don't assure continued price increases. Their impact hinges on sustained buying and how it balances against selling pressure elsewhere.

Faster inflow growth would bolster demand as bitcoin tests overhead resistance. On the other hand, slowing flows could make the recovery rely more on other sources of buying.

At present, ETF activity is among the elements backing the recent price rise.

Weak jobs data lower October rate hike odds

Following a weaker-than-expected U.S. jobs report on Friday, investors trimmed their expectations for another Fed rate hike.

Nonfarm payrolls increased by 29,000 in September, the Bureau of Labor Statistics reported, below the anticipated 90,000. August's figure was revised lower to 133,000 from 162,000.

After the data, the CME FedWatch tool on Monday showed an 18.3% probability of a rate hike in October, dropping from about 70% a week earlier.

Lower expectations for tighter policy can support risk assets by alleviating worries about stricter financial conditions.

But reduced hike odds do not guarantee looser policy. They represent market pricing that can shift with new economic data.

Bitcoin technical outlook: Weekly resistance blocks path to $90,000

On the weekly chart, bitcoin encounters first resistance at $87,599, representing the 50% retracement from the August 2024 low of $49,000 to the October 2025 record high of $126,199.

A close above that level would target the 100-week simple moving average near $89,832, then the psychological $90,000 mark.

Weekly momentum favors the recovery. The RSI, around 62, is trending higher, and the MACD histogram bars are expanding in positive territory.

If resistance holds and a deeper correction occurs, downside targets include the $78,490 Fibonacci level and the 50-day SMA around $77,201.

The daily chart shows bitcoin trading above its 50-, 100-, and 200-day exponential moving averages, supporting the short-term bullish view.

The daily RSI is near 67, signaling strong momentum just under overbought levels. The MACD histogram has drifted toward zero, implying that upside momentum is decelerating.

Near-term support is at $85,000. A daily close below that level would undermine the consolidation pattern and open the door to the 50-day EMA near $79,189.

Lower down, the 100-day EMA at $75,367 and the 200-day EMA near $74,994 provide additional support. Further out, horizontal levels at $66,500 and $62,300 are noted.

Bitcoin's recovery is still intact, but a break above $87,599 would give a firmer signal that buyers can push to $90,000.