Bitcoin is under pressure once again, falling below the $110,000 mark as traders grow cautious amid weakening demand for crypto exchange-traded funds (ETFs). The decline has also sparked the formation of two potentially bearish chart patterns that could signal more downside ahead.
Bitcoin retreats alongside ETF weakness
As of Saturday, September 27, Bitcoin (BTC) was changing hands at around $109,600 roughly 12% lower than its record high and at its lowest point since September 2. The move comes as American investors pulled back, leading to slowing ETF inflows over the past two weeks.
Fresh data from SoSoValue shows all Bitcoin ETFs posted outflows of $902 million this week, reversing the $886 million inflows recorded just a week earlier. For context, ETFs added a massive $2.34 billion the week of September 12, highlighting how quickly sentiment has shifted.
Part of the caution in markets stems from comments by Federal Reserve officials. Policymakers including Austan Goolsbee, Beth Hammack, and Raphael Bostic warned that the central bank should avoid rushing into interest rate cuts. Inflation remains above the Fed’s 2% target, unemployment is still low, and economic data such as a 3.8% GDP expansion in Q2 and declining jobless claims continues to point to resilience.
With that backdrop, traders are now watching next Friday’s U.S. non-farm payrolls data closely. The jobs report could play a key role in shaping expectations for whether the Fed moves to cut rates at its October meeting.
Head-and-shoulders pattern signals caution
On the daily chart, Bitcoin appears to be forming a head-and-shoulders pattern a bearish setup that often precedes further declines. The coin is also trading below its 50-day Exponential Moving Average, while the Relative Strength Index (RSI) is trending lower. Together, these indicators suggest a possible slide toward the 50% Fibonacci retracement level around $100,000.
Rising wedge adds to bearish outlook
Zooming out to the weekly chart, Bitcoin has also developed a rising wedge pattern another bearish signal characterized by two upward-sloping trendlines converging. With the wedge nearing its breakout point, technical analysts warn of a potential downside move.
Adding to this, both the RSI and the MACD are flashing bearish divergence, showing momentum fading even as prices have climbed in recent months. This divergence, combined with the wedge pattern, strengthens the case for caution in the weeks ahead.
Bottom line
Bitcoin’s dip below $110K comes at a time when investor appetite through ETFs is waning, and the charts are showing cracks in momentum. With two bearish technical patterns forming and macro uncertainty around Fed policy, traders may need to brace for more volatility and potentially deeper pullbacks in the near term.
