Bitcoin News Today: Bitcoin's Volatility Test: Fed Policy Shifts vs. Institutional Inflow Surge

Bitcoin faces a pivotal period as Federal Reserve decisions and market dynamics shape its short-term trajectory and long-term bullish outlook. Recent developments highlight a complex interplay between central bank policy, institutional investment flows, and technical price action, with analysts offering divergent but generally optimistic forecasts.

The U.S. Federal Reserve's decision to cut interest rates by 25 basis points in late September 2025 marked a shift toward easing monetary policy, with officials signaling only two additional rate cuts in 2025. This hawkish tone, coupled with an upward revision of inflation forecasts from 2.1% to 2.5%, triggered an immediate 4.6% drop in Bitcoin's price to $101,300 Cointelegraph^[2]. Analysts attribute this correction to market recalibration following Powell's emphasis on maintaining policy flexibility amid economic uncertainties, including potential Trump-era tariffs and labor market shifts Cointelegraph^[2].

Despite the short-term volatility, institutional investment flows remain robust. BlackRock's iShares Bitcoin Trust (IBIT) recorded $3.5 billion in weekly inflows during October 2025, propelling Bitcoin to an all-time high of $126,080 CCN^[6]. This surge, driven by record ETF inflows across the sector, underscores growing institutional adoption. U.S. spot Bitcoin ETFs now command $169.48 billion in net assets, representing 6.79% of Bitcoin's market cap . Analysts like Nate Geraci and Standard Chartered predict further gains, with some forecasting $200,000 by year-end if inflows persist CCN^[6].

Technical analysis from Coingape and Coinpedia outlines two key scenarios. In the first, Bitcoin could retest the $104,000 support level before rebounding, while a deeper correction to $92,000 aligns with historical gap-filling patterns Coingape^[3]. Both scenarios, however, point to eventual recovery, with long-term projections unchanged. The $120,000–$124,000 range is critical for maintaining bullish momentum, with the 200-day EMA at $107,500 acting as a key long-term floor CCN^[6].

Market observers also highlight the role of ETF approvals in shaping Bitcoin's trajectory. The October 2025 ETF inflow surge mirrors the 2020–2021 institutional adoption wave, with BlackRock's IBIT now nearing $100 billion in assets under management CCN^[6]. This trend aligns with broader macroeconomic narratives, including dollar de-risking and inflation hedging, as noted by Citadel's Ken Griffin Forbes Digital Assets^[1].

Longer-term forecasts remain positive. Historical data from Decrypt indicates Bitcoin has rallied 62% of the time three months post-Fed rate cuts, with an average gain of 16.50% Decrypt^[4]. HashKey Capital projects $700,000 by 2035, assuming a 10% annual gold price growth Decrypt^[4]. Meanwhile, regulatory clarity-such as President Trump's January 2025 executive order mandating a federal crypto framework-further supports institutional confidence CCN^[6].

The immediate outlook hinges on the Fed's upcoming decisions and the resolution of short-term volatility. Analysts like Peter Chung of Presto Research emphasize that Powell's post-meeting guidance will determine whether Bitcoin experiences a "sell-the-news" reaction or initiates a sustained rally Decrypt^[4]. If the Fed adopts a more dovish stance, Bitcoin could retest its all-time highs by year-end, leveraging its role as a hedge against inflation and dollar debasement Forbes Digital Assets^[1].