Bitcoin’s August rally hinges on sustained ETF demand amid rising Fed rate‑hike expectations

Bitcoin is trading near $78,700 after pulling back from a recent high above $81,000. Analysts highlight that the cryptocurrency’s next move will be shaped by spot exchange‑traded fund (ETF) demand and upcoming U.S. economic data that could influence Federal Reserve policy.

Spot buying and modest leverage support the market

Bitfinex analysts note that the rally has been driven more by spot purchases than by a rapid build‑up of leveraged positions. Open interest sits around $55.6 billion, roughly 20 % above early‑August levels, but has risen gradually and the futures basis remains low by historical standards.

ETF inflows as a barometer of demand

U.S. spot Bitcoin ETFs recorded about $3.04 billion of net inflows over nine consecutive positive sessions from August 17‑27. Although Friday saw a net outflow of $201.9 million, the funds ended the week with $924.5 million in net inflows, and two‑week inflows total roughly $2.8 billion.

BlackRock’s IBIT ETF accounted for $33.4 million of the Friday outflows after accumulating roughly $2.3 billion in the prior nine sessions. ARKB and BITB together saw $164.6 million of outflows.

Institutional activity offsets whale profit‑taking

Whale addresses holding 1,000‑10,000 BTC have reduced balances by about 50,500 BTC since late June. In contrast, institutional custodial holdings linked to exchanges and ETF platforms have risen by roughly 59,100 BTC, with a net increase of 31,500 BTC during the latest August advance.

Key price zones and supply tests

CoinEx analyst Jeff Ko identifies the $80,000‑$83,000 range as a major supply zone where real capital allocation will be tested. Breaking this zone could signal that spot demand, rather than short‑squeeze dynamics, is sustaining the rally.

Fed rate‑hike risk and macro data

Remarks at the Jackson Hole symposium have lifted the market‑implied probability of a September rate increase to about 57 %. Core PCE inflation sits at 3.3 % and headline PCE at 3.7 %.

Analysts caution that higher rates could reduce liquidity for crypto assets. They stress the need for continued ETF demand across multiple products and for inflation data that might ease Fed pressure.

Upcoming U.S. releases

Key data points before the Fed’s September 15‑16 meeting include the August payroll report, ISM Manufacturing, JOLTS, ADP employment, the Beige Book, and ISM Services. The August inflation report is slated for September 11.

Outlook

BTSE’s Jeff Mei sees $87,000 as the next significant resistance level; a sustained break could open a path toward $100,000.

Ether ETF inflows have been strong, with U.S. spot Ether products taking in $815.7 million last week, suggesting broader crypto risk appetite.

Overall, Bitcoin’s near‑term trajectory will depend on whether spot ETF demand remains robust and whether upcoming macro data eases expectations of further rate hikes.