Bitcoin Hits 7-Month High as FOMO Peaks, But 2 Signals Still Flash Caution

Bitcoin (BTC) reached an intraday high of $87,395 on September 21, its strongest level since January 29, and was trading around $85,326 at the time of reporting, up 4.90% over the previous 24 hours.

Price Momentum and Market Activity

The rally followed a weekly close back above the 50‑week moving average, a historically bullish signal. A short squeeze contributed significantly, with $746.6 million in crypto liquidations over 24 hours, of which $647.9 million were short positions. Overall market trading volume rose 39% to roughly $224 billion, supporting the price advance.

Sentiment and Institutional Flows

Social sentiment aligned with the price move. Santiment recorded the largest spike in bullish commentary since December 2024, with 954 bullish mentions versus 269 bearish. The Crypto Fear & Greed Index climbed to 78 (Extreme Greed) from 70 the previous day.

Corporate treasury activity increased: Strive purchased 1,355 BTC for about $107.7 million between September 14‑18, raising its holdings to 26,355 BTC. Strategy also added 950 BTC, bringing its total to 846,000 BTC.

Spot Bitcoin ETFs continued to attract inflows, absorbing $999 million on September 21—their largest single‑day intake since October 6, 2025—raising total net assets to $110.1 billion.

Signals of Caution

Two factors temper the bullish outlook:

• Rising leverage: Open interest on crypto derivatives increased 7.59% to about $156 billion, indicating new position building despite short liquidations.
• US spot demand weakness: The Coinbase Premium Index remained slightly negative at -0.028, suggesting limited buying pressure on the US exchange.

Analysts note that extreme bullish sentiment can precede local tops, and the current sentiment spike does not guarantee a sustained rally.

Outlook

Future sessions will reveal whether the price move represents a durable trend shift or a rally heavily reliant on short‑squeeze dynamics.