Bitcoin News Today: Investors Shift Focus as Bitcoin Slides, Labor Woes Spark Fed Cut Hopes

The crypto market experienced a notable shift in late August 2025 as Bitcoin prices retreated below $108,000 after hitting an all-time high of $124,400 earlier in the month. This decline, observed on platforms like Coinbase and TradingView, marked a more than 13% drop from its peak. Analysts attributed the pullback to standard market mechanics, such as profit-taking by institutional funds, elevated funding rates in derivatives markets, and thinner liquidity conditions during August trading. "Markets don’t move in a straight line," stated Mike Cahill of Douro Labs, noting that such retracements are common in 24/7-traded assets like Bitcoin. Joe DiPasquale of BitBull Capital added that the pullback also reflected lingering macroeconomic uncertainties and a cooling in ETF inflows, which had previously supported the upward momentum of the asset [1].

The weakening Bitcoin position was further compounded by a noticeable shift in investor sentiment and capital allocation. Greg Magadini of Amberdata highlighted that after a prolonged underperformance of Ethereum (ETH) compared to Bitcoin, there was a deliberate rebalancing of funds from BTC to ETH. This shift was driven by ETH's position as a "web3/tech play" and its integration with staking rewards and regulatory filings for ETFs. Tom Bruni of Stocktwits noted that Bitcoin's dominance had fallen from 66% to 57% in recent months as investors moved money into smaller-cap altcoins like Ethereum, Ripple, and others. With Bitcoin failing to sustain its all-time highs and support levels near $110,000 showing signs of breaking, the market is now closely watching the $100,000 level as a potential next key threshold [1].

Simultaneously, the U.S. labor market began flashing significant warning signs that could influence broader economic and market dynamics. The August jobs report released by the Bureau of Labor Statistics on September 5 revealed that the U.S. economy added only 22,000 new jobs, far below the 75,000 forecast by economists. The unemployment rate rose to 4.3%, the highest level in nearly four years. This marked a dramatic slowdown from the previous month's revised 79,000 job additions. Additionally, the number of job openings fell to 7.18 million, the lowest in 10 months, and for the first time since April 2021, the number of unemployed individuals exceeded open positions. These data points reinforced concerns about a cooling labor market and raised expectations for a Federal Reserve rate cut [6].

The weak labor data intensified speculation about a September rate cut by the Federal Reserve, which could stimulate broader market activity, including the crypto sector. Fed Governor Christopher Waller and others advocated for a 0.25% cut in September, with further reductions likely in the following months. The CME Group's FedWatch tool indicated a 98% probability of a 0.25% rate cut by the Fed during its September meeting, with a 2% chance of a larger 0.50% cut. This potential shift in monetary policy could act as a catalyst for a broader market rebound, especially for risk assets like Bitcoin and Ethereum. Analysts noted that lower interest rates typically boost investor appetite for high-growth assets, which could lead to renewed inflows into the crypto market [4].

Looking ahead, the interplay between macroeconomic developments and crypto market dynamics will remain a focal point. Bitcoin is expected to trade in a sideways range between $107,000 and $113,000 in the near term, with a higher likelihood of continued downward pressure due to historical leverage ratios and prior deleveraging events in similar market conditions. Ethereum, on the other hand, is underpinned by strong institutional buying, with the top three institutional holders increasing their ETH holdings by $1.1 billion. If ETH can break and hold above $4,500, it could set a new historical high. Altcoins like EMMM and TON also showed signs of strength, particularly in terms of trading volume and institutional support, suggesting a broader rotation of capital within the crypto ecosystem [3].

As the market awaits the Fed’s decision, investors are cautiously optimistic. The combination of weak labor data, the potential for rate cuts, and evolving capital flows into altcoins creates a complex but potentially bullish outlook for risk assets. While Bitcoin faces near-term technical challenges, the broader market environment could provide a supportive backdrop for a recovery. Traders and analysts are closely monitoring key resistance and support levels for both BTC and ETH, as well as broader macroeconomic indicators, to gauge the next potential moves in this dynamic and rapidly evolving market [3].

Source:

[1] Forbes - Bitcoin Prices Have Retreated Below $108,000 After Peaking Mid-Month (https://www.forbes.com/sites/digital-assets/2025/08/29/bitcoin-prices-have-retreated-below-108000-after-peaking-mid-month/)

[2] PANews - If Bitcoin Loses the $106,000–108,000 Range, the Market May ... (https://www.panewslab.com/en/articles/4e7c9660-94c5-4a6a-9b8b-4fc48c0adbe6)

[3] Futunn - Bitcoin's Price Plunged by $108,000; Ethereum Dropped by $4,200 (https://news.futunn.com/en/post/61655858/bitcoin-s-price-plunged-by-108000-ethereum-dropped-by-4200)

[4] The Street - Fresh Labor Market Data Fuels Chatter About Fed Interest Rate Cuts (https://www.thestreet.com/fed/fresh-labor-market-data-fuels-chatter-about-fed-interest-rate-cuts)

[5] CNN - America's Job Market Flashes Yet Another Warning Sign (https://www.cnn.com/business/live-news/us-jobs-report-august-2025)

[6] Yahoo Finance - US Economy Adds 22,000 Jobs, Unemployment Rate Hits 4.3% (https://finance.yahoo.com/news/us-economy-adds-22000-jobs-unemployment-rate-hits-43-in-august-as-labor-market-continues-dramatic-slowdown-153001609.html)