Bitcoin +0.07% as ETF Inflows and Institutional Buying Drive Price Recovery

On October 26, 2025, Bitcoin (BTC) rose by 0.07% within 24 hours to reach $111,693.77, reflecting a modest but significant rebound after a month of volatility. Over the past 7 days, BTC gained 3.16%, though it remains down 2.04% over the last month. The long-term bullish trend is evident, with a year-to-date increase of 19.39%. The market cap of the cryptocurrency sector stands at $3.84T, with Bitcoin continuing to represent 58.03% of the total value.

Institutional demand for Bitcoin has been a key driver of the recent price movement. On October 24, U.S. spot Bitcoin ETFs recorded net inflows of $446.6 million, with BlackRock’s iShares Bitcoin Trust (IBIT) absorbing $324.3 million and Fidelity’s Wise Origin Bitcoin Fund (FBTC) attracting $52.3 million. These figures highlight the growing institutional confidence in Bitcoin as a core asset class. Despite recent turbulence, including a $1.23 billion outflow in the week of October 13, the swift reversal suggests that institutional investors are treating Bitcoin’s pullbacks as strategic entry points.

Technically, Bitcoin is trading below the 50-day Exponential Moving Average (EMA) but above the 200-day EMA. This divergence suggests a bearish near-term bias but a bullish longer-term outlook. On the daily chart, a breakout above the 50-day EMA could bring $115,000 into play, with the all-time high of $125,671 remaining a potential target for bulls. On the downside, a breakdown below the 200-day EMA could see Bitcoin retesting the October 17 low of $103,576 and potentially falling to $100,000.

The market is currently in a holding pattern as traders await key macroeconomic developments. The U.S. Federal Reserve’s interest rate decision on October 29 is expected to play a critical role in shaping sentiment. Analysts project that a dovish stance, particularly if it includes a December rate cut, could bolster demand for Bitcoin. Conversely, a hawkish outcome may weigh on risk assets. Additionally, the U.S.-China trade outlook, including the potential meeting between President Trump and President Xi, remains a wildcard factor.

Backtest Hypothesis

Given the recent technical consolidation above the $110,000 level and the potential for a breakout, a backtesting strategy centered on the MACD Golden Cross could offer insight into how institutional buyers and algorithmic systems might approach Bitcoin. The hypothesis assumes the use of standard MACD parameters (12-, 26-period EMAs, and a 9-period signal line), with the entry signal defined as the MACD line crossing above the signal line. The exit rule would trigger when the daily close of BTCUSD reaches or exceeds $114,500. If the target is not met, any open position would be closed at the end of the backtest period (October 25, 2025).

Position sizing would assume full-capital allocation for each trade, with no overlapping positions allowed to ensure clarity in the performance evaluation. Using daily closing prices for BTCUSD, the backtest would span from January 1, 2022, to October 25, 2025, offering a comprehensive view of how the strategy would have performed across multiple market cycles. The results could help traders and investors determine whether a MACD-driven strategy is viable in the current environment, particularly in the context of rising institutional ETF participation and macroeconomic shifts.