After retreating to the $81,000 level, Bitcoin recovered and settled around $82,000. The daily decline narrowed to 1.54%. However, the market remains focused on the $81,000 mark; this is precisely where buyers and sellers are squaring off.

The $81,000–$81,500 range is an area where buy orders have concentrated in recent days, with buyers increasing their positions there. Analysts identify the $81,119 level as support, while pointing to the $86,500–$86,750 range as resistance. In other words, $81,000 is not an arbitrary level; it is the floor that has held firm in recent weeks.

So, why did it drop this far? Three distinct pressures came into play simultaneously.

First is the Fed. Minutes from the September meeting, released on October 7, revealed that all 19 officials supported an interest rate hike. Most believe another hike before year-end would be appropriate. However, the market remains unconvinced regarding October; the probability of a hike in October stands at around 17%, compared to 70% for December. A high-interest-rate environment raises the cost of holding non-yielding assets, thereby exerting downward pressure on prices.

Second are geopolitical developments. Reports indicate that the White House has asked the Pentagon to prepare options regarding Iran. Disruptions in the Strait of Hormuz persist. Brent crude is trading at $101.53, and WTI at $89.39. High energy costs are keeping inflation expectations elevated, reinforcing the Fed's cautious stance.

The third—and most keenly felt—factor was leverage. Over $1.14 billion in futures positions were liquidated within the 24-hour period ending October 8. Another $172 million was wiped out when Bitcoin dipped below $81,000. Approximately 140,000 accounts were affected. Open interest fell by 3.27% to $52.57 billion. This points to forced position closures rather than a mere change of heart among investors.

Interestingly, institutional demand persists despite this sell-off. U.S. spot Bitcoin ETFs recorded net inflows of $118.86 million in the latest session, with total assets standing at $110.68 billion. JPMorgan estimates that approximately $50 billion will flow into the crypto market through 2026; in other words, "big money" remains in the game.

However, Ether ETFs saw net outflows of $202 million on the same day. A clear divergence in demand between the two major digital assets has emerged.

On the supply side, government-linked wallets moved 12,267 BTC to new addresses. Since no exchange inflows were recorded, this move appears to be a reorganization rather than a sell-off. Nevertheless, should these coins eventually reach an exchange, they could create fresh supply-side pressure.

From a technical perspective, Bitcoin stabilized around $82,063 after retreating from $83,299 to a low of $80,397. The recovery was driven by a drop in open interest and the return of buyers. This points to a forced deleveraging event rather than a shift in the fundamental outlook.

The next real test comes with the October CPI and PPI data. These figures will reveal whether inflation is truly cooling. If the $81,000 level holds, the market may stabilize; if it breaks, the next stop could be the $80,500 zone.

This article does not constitute investment advice. The analysis is based on publicly available information and does not guarantee future results.

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