Bitcoin rallied through a widely anticipated Federal Reserve rate hike in mid-September but has faced pressure as bond markets moved sharply higher, according to market analysis.
The Fed raised rates to 3.75 to 4.00% on September 16, a decision that futures markets had priced in at close to 90% probability beforehand. Bitcoin initially dipped below $75,000 but recovered to trade above $87,000 within a week. Spot Bitcoin ETFs captured $2.39 billion in inflows during the week ending September 25, their largest weekly intake since October 2025.
The rally reversed course when bond markets moved significantly. On September 23, the 10-year U.S. Treasury yield jumped more than 18 basis points—the largest single-day increase since April 2025—and continued climbing above 5.2% the next day, reaching its highest level since 2007. The 30-year Treasury yield approached 5.50%, levels last seen in 2004. Multiple factors contributed to the move, including strong economic data, a weak Treasury auction, and higher oil prices.
The distinction between how Bitcoin responded to the rate hike versus the bond selloff is significant. The rate hike was a single, expected event with a known magnitude, while the bond selloff represents an open-ended market repricing with no predetermined endpoint. Yields above 5% compete directly with assets that generate no income.
Bitcoin ETF flows reflected the shift. Daily inflows totaled $999 million on the first day of the bond rally but declined to $135 million by Friday, suggesting buying pressure eased as yields continued rising.
On longer-term charts, Bitcoin broke above the $70,000 region around August 20 and consolidated near $80,000 before moving higher. The move above $87,000 marked the first higher high on multi-day timeframes since the bear market began. Technical indicators show the 20-day exponential moving average crossed above the 50-day EMA, a signal not seen since November 2025.
The $80,000 level represents key support for maintaining the constructive structure. The 50% Fibonacci retracement of the move from $75,000 to $87,000 falls near $81,000.
