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Bitcoin slips below $110,000 before critical US inflation data release.
CPI report on October 15 could set the next big trend for crypto.
Market volatility will stay high as Fed policy expectations shift
Bitcoin price has faced a fresh wave of selling pressure in late September 2025, slipping below the $110,000 mark just days before the release of new US inflation figures. The decline has drawn strong attention as inflation data often sets the tone for financial markets, especially with investors closely tracking how it might influence Federal Reserve policy decisions.
The world’s largest cryptocurrency dropped more than 5% this week and is now over 10% lower than its August peak above $124,000. The fall comes as investors turn cautious, scaling back risk exposure ahead of important economic updates. This has created a tense environment for Bitcoin and other cryptocurrencies, which are increasingly seen as tied to wider financial markets.
In recent trading sessions, Bitcoin hovered between $108,000 and $112,000 after failing to hold earlier highs. The pullback was made worse by heavy liquidations of leveraged positions and visible outflows from Bitcoin exchange-traded products. Many large investors also decided to take profits following a long rally earlier in the year.
Another factor weighing on Bitcoin was the anticipation of upcoming options expiries. Large concentrations of options contracts around certain price levels often create volatility as traders rebalance their positions. Combined with reduced risk appetite, these flows added extra pressure on the cryptocurrency market.
The mood in traditional markets also spilled into Bitcoin trading. A recent uptick in inflation indicators such as the Personal Consumption Expenditures (PCE) index suggested that price pressures remain sticky. This raised worries that the Federal Reserve may delay interest-rate cuts, which would keep financial conditions tight. For BTC, this meant fewer immediate inflows from institutional investors and more hesitation from retail traders.
The next big test for markets is the US Consumer Price Index (CPI) report. It is scheduled for release on October 15, 2025, at 8:30 a.m. Eastern Time. This report is critical as it will show whether inflation is cooling or staying elevated, and that outcome could influence the Fed’s timeline for lowering interest rates.
For Bitcoin, the CPI report carries huge weight. A hotter-than-expected inflation reading could push the Fed to stay restrictive for longer, which often hurts risk assets. On the other hand, a softer number could give investors confidence that policy easing may come sooner, encouraging a fresh wave of buying in cryptocurrencies.
Traders know this well, which is why many are pulling back from aggressive bets before the report. This has added to selling pressure in the days leading up to the release.
From a technical standpoint, Bitcoin has broken out of the bullish channels that supported its earlier climb. Momentum indicators now show weaker buying interest, with moving averages beginning to converge. Trading volumes have spiked on the downside, showing that sellers currently have the upper hand.
Key resistance levels stand between $113,000 and $115,000, where Bitcoin has repeatedly struggled to push higher. On the downside, strong support is visible between $105,000 and $108,000. If this range breaks, the cryptocurrency could test lower levels near $100,000. But if buyers manage to push back above resistance, the bullish case could be restored and set the stage for another attempt at $120,000 and beyond.
Another key factor is institutional flow. Bitcoin exchange-traded funds and trust products saw net outflows in recent weeks. This suggests that some institutions are cashing in profits rather than adding to positions. Options markets also show a heavy buildup around key strike prices, which can spark sudden swings when expiries take place.
Also Read: US Dollar Bounces Back, Gold Rally Pauses: Bitcoin’s Next Move?
Bitcoin is often described as ‘digital gold,’ but in practice, it moves more like a risk asset. When investors expect lower interest rates, riskier assets tend to gain as future returns look more attractive. When inflation stays high and rates remain elevated, money often flows out of speculative markets.
This explains why inflation numbers have such a direct impact on Bitcoin. A higher-than-expected inflation figure could reduce demand for cryptocurrencies, while a softer number could boost interest. Liquidity conditions also play a major role. If monetary policy stays tight for longer, there may be fewer inflows into Bitcoin markets, leading to higher volatility and sharper corrections.
Over the past year, Bitcoin’s correlation with equities and tech stocks has strengthened. This means that any shift in inflation expectations or central bank policy tends to ripple across both traditional and digital assets.
If the October CPI reading shows inflation is hotter than expected, Bitcoin may come under immediate pressure. Traders could drive prices toward the $100,000 level or lower if selling accelerates.
If the report comes in line with forecasts, Bitcoin may remain range-bound, trading between its support and resistance zones while investors wait for further data such as jobs reports and Fed updates.
If inflation cools more than expected, Bitcoin price prediction and news could see a sharp rebound. Optimism about earlier rate cuts would encourage a return of risk appetite, and prices could quickly push back toward the $120,000 mark.
The cryptocurrency market remains heavily influenced by leverage. When prices move sharply, forced liquidations often exaggerate the swings. For this reason, cautious position sizing and close monitoring of key levels are critical.
Liquidity from stablecoins, activity on major exchanges, and ETF flows can provide early warning signals of whether markets are strengthening or weakening. At the same time, observing Bitcoin’s correlation with stock markets can help gauge whether broader financial trends are likely to spill over into crypto.
Also Read: Why is Bitcoin Dropping and BNB Gaining Momentum?
Bitcoin price decline below $110,000 in late September 2025 highlights how sensitive the market has become to macroeconomic data. The upcoming CPI report on October 15 will be the next major catalyst, with the potential to either extend the correction or revive the rally.
Until then, volatility is expected to stay high. Traders and investors are bracing for sharp moves depending on the outcome of the inflation data. Whether Bitcoin resumes its path toward $120,000 or slides closer to $100,000 will depend largely on how the inflation story unfolds and how the Federal Reserve responds in the weeks ahead.
1. Why did Bitcoin drop below $110,000 in September 2025?
Bitcoin fell due to profit-taking, ETF outflows, and investor caution ahead of key US inflation data, which could impact Federal Reserve policy decisions.
2. When is the next US CPI report, and why does it matter for Bitcoin?
The next CPI report is scheduled for October 15, 2025. It will influence inflation expectations and the timing of Fed rate cuts, both of which directly affect Bitcoin.
3. What levels are traders watching for Bitcoin in the short term?
Resistance is between $113,000 and $115,000, while support lies between $105,000 and $108,000. A break below $105,000 could trigger deeper declines.
4. How does inflation affect Bitcoin prices?
High inflation and tighter monetary policy reduce investor appetite for risk assets like Bitcoin. Lower inflation can boost confidence and attract new buyers.
5. Could Bitcoin recover to $120,000 after the CPI release?
If inflation data comes in cooler than expected, optimism about earlier Fed easing could fuel a strong rebound, potentially sending Bitcoin back toward $120,000.
