Bitcoin News Today: Bitcoin's Divergent Signals: Rally or Correction as Market Holds Breath?

Bitcoin's price has retreated below $110,000, sparking renewed fears of a collapse toward the psychological $100,000 level after filling a key CME futures gap. The cryptocurrency, which hit a four-month high of $126,000 in early October, now trades near $105,600, with technical analysts and on-chain data highlighting divergent outcomes: a potential rally to $130,000 or a sharp correction.

The latest CME gap-formed between $109,680 and $111,310-has drawn attention as traders observe parallels to a 2024 bullish pattern. At that time, Bitcoin filled a similar gap at $68,785 before surging to $108,000 over two months. Analysts at RektCapital note a "bullish divergence" forming on daily charts, suggesting a possible rebound to $130,000 by year-end. However, the market remains fragile. CryptoQuant data shows Bitcoin's funding rate on Binance turned negative, a historical precursor to market bottoms, while on-chain outflows indicate quiet accumulation amid widespread fear .

Macroeconomic factors add complexity. The CME's FedWatch tool estimates a 96.7% probability of a Federal Reserve rate cut in November, a potential tailwind for risk assets like Bitcoin. Yet U.S.-China trade tensions and a prolonged government shutdown risk could dampen sentiment. Farzam Ehsani, CEO of VALR, emphasized the growing overlap between gold and Bitcoin as safe-haven assets. "Investors increasingly view both as hedges against fiscal risks," he said, noting gold's recent 28% surge versus Bitcoin's 4.4% decline .

Technical indicators paint a mixed picture. Bitcoin's monthly Bollinger Bands have expanded to record extremes, a pattern historically followed by higher prices. However, the RSI near 44 and weak buying pressure at $113,500 suggest short-term uncertainty . The 50-day exponential moving average (EMA) at $113,253 remains a critical threshold; a close above could signal a resumption of bullish momentum, while a breakdown below $110,000 risks a test of the $104,582 support level .

Market sentiment is deeply divided. The Binance Fear and Greed Index dropped to 39, reflecting growing caution, while the Crypto Fear & Greed Index hit multi-year lows of 10-a level last seen during the FTX collapse. Meanwhile, Bitcoin's exchange reserves have fallen to 2.3 million BTC, a six-year low that signals reduced selling pressure and potential scarcity-driven bullishness .

A critical divergence between Bitcoin's price and trading volume has also emerged. Despite hovering near all-time highs, spot volume remains 42% below 2024 levels, with only 25% of Bitcoin's supply deemed liquid. CryptoQuant's Dan highlighted this as a "cooling" phase, lacking speculative fervor seen in prior cycles. "Patience is key," he advised, noting macroeconomic catalysts like rate cuts could reignite momentum .

The path forward hinges on institutional and retail dynamics. ETF outflows-$902.5 million last week-have disrupted inflow trends, while large holders appear to be accumulating. However, overleveraged longs at $105,000 and a dense liquidation zone near $117,694 could trigger cascading selling if prices dip further .

[1] Bitcoin Fills Weekly CME Gap To Mirror 2024 Reversal Pattern – ... (https://finance.yahoo.com/news/bitcoin-fills-weekly-cme-gap-190925015.html)

[2] Bitcoin Finally Fills CME Gap - What's Next for BTC? (https://www.coinspeaker.com/bitcoin-fills-cme-gap-whats-next/)

[3] Is BTC price about to fill a $78K Bitcoin futures ... (https://cointelegraph.com/news/is-bitcoin-price-about-to-fill-78-k-cme-futures-gap)

[4] Will BTC decline to fill the CME gap before recovering? - FXStreet (https://www.fxstreet.com/cryptocurrencies/news/bitcoin-price-forecast-btc-risks-decline-to-fill-cme-gap-before-potential-recovery-202509291000)

[11] Why is BTC dropping so sharply this week? (https://coinpedia.org/price-analysis/why-is-btc-dropping-uncovering-price-and-liquidation-heatmap/)

[13] Why is Spot Volume Declining Despite Bitcoin Hovering Near ATH? (https://beincrypto.com/why-is-bitcoin-spot-volume-declining/)