The first cryptocurrency continues to face challenges, largely due to selling pressure. Nevertheless, BTC is striving to prevent Ethereum from firmly taking the lead.
The complex situation with the Federal Reserve and the anticipation of rate cuts is adding fuel to the fire, although the rise of the S&P 500 index adds a positive note.
Bitcoin has struggled to maintain its momentum after retreating from a recent high of $124,000. However, those efforts proved unsuccessful: the flagship asset pulled back to $111,090, dropping sharply by 10.5% from its previous peak.
This pullback reflects growing uncertainty among traders, as buying pressure weakens, even though some on-chain indicators suggest potential accumulation.
On Thursday, August 28, Bitcoin began the day moving sideways. Later, the cryptocurrency was trading around $113,120. Over the past week, BTC declined by 3%, with a modest 0.3% gain in the last 24 hours and virtually no change on the 1-hour chart.
According to analysts, BTC's movement in a narrow range reflects the ongoing tug-of-war between buyers and sellers. At the same time, on-chain data appears promising.
Exchange flows: Bitcoin selling pressure lasted 10 days
Analysts believe one of the key ways to track pressure is through net exchange flows. Positive flows mean more coins are being sent to exchanges, often indicating selling. Outflows signal tokens are leaving exchanges, usually suggesting buying.
Bitcoin inflows to exchanges remained steady for 10 straight sessions. On Sunday, August 24, they peaked at 6,775 BTC—one of the largest values in recent months. However, the situation shifted afterwards. On Tuesday, August 26, inflows still exceeded 4,239 BTC but remained below the peak.
By the end of the current week, net flows turned negative. Analysts interpret this as a possible sign that sellers are losing control. Buyers are attempting to take over, but the outcome remains unclear. If inflows increase again, the selling scenario for BTC remains relevant.
A sharp rise in purchasing power has coincided with Bitcoin's current consolidation phase, signaling that some traders are preparing for a price rebound. Historically, an increase in stablecoin inflows has often preceded heightened trading activity, with many participants using those reserves to open positions under favorable conditions.
Ethereum Leads in Spot ETF Net Flows. Bitcoin Takes Second Place
The second-largest cryptocurrency by market cap, Ethereum, is trading sideways near $4,549. Meanwhile, Ethereum ETFs have outpaced Bitcoin for the seventh day in a row. ETH is also supported by strong daily inflows into ETFs, which have reached an impressive $455 million.
This shift has surprised analysts and market participants. Typically, spot Bitcoin ETFs attract more capital, given BTC's dominance and higher investor interest. However, the trend has recently changed. For seven consecutive days, ETH ETFs have been leading BTC ETFs. This could indicate growing investor rotation and increasing interest in Ethereum.
Key BTC levels to watch
Currently, Bitcoin's price is trading in a broad range between $108,600 and $112,300. According to experts, this range illustrates the balanced battle between bulls and bears. If selling pressure intensifies and capital inflows rise, BTC may break below $108,600. This could trigger further losses and a deeper correction.
However, if buyers maintain the current modest outflow, Bitcoin's first goal will be a confident close above $112,300. If successful, the flagship asset may rise to $116,500, then to $118,400 and beyond.
Right now, Bitcoin is stuck between selling pressure and encouraging signals from short-term holders. If inflows subside, bulls may get a chance to push higher. Otherwise, a new decline for the leading cryptocurrency remains possible.
S&P 500 climbs despite Fed–Trump scandal
At the start of the current week, US stock indexes closed in positive territory. The market largely ignored the latest clash between President Donald Trump and the Federal Reserve. This time, however, Trump's target wasn't Fed Chair Jerome Powell but rather Lisa Cook, a member of the Fed's Board of Governors.
The formal trigger for this new conflict was Cook's dismissal, with Trump accusing her of mortgage fraud. However, Cook stated that the president does not have the authority to remove her. The market's reaction to this standoff was highly volatile: bonds saw more turbulence than stocks.
As a result, yields on long-term Treasury bonds rose, while short-term yields declined. This dynamic typically suggests a possible near-term rate cut from the Fed, along with rising inflation risks.
Meanwhile, the US Dollar Index (DXY) fell by 0.2%. The S&P 500 behaved differently—it added 0.41% and reached 6,465.94. The Nasdaq Composite rose 0.44% to 21,544.27, and the Dow Jones gained 135.6 points to 45,418.07.
According to Craig Chan, Head of FX Strategy at Nomura, Trump's actions may revive historical parallels with Richard Nixon's presidency. Like then, the president is pressuring the Fed in the middle of an election cycle, which negatively impacts the US economy and the national currency.
If the market senses the Fed is losing its independence, the consequences could be similar: a sharp weakening of the dollar and a flight to safe-haven assets. While the current situation only bears some resemblance to past events, conditions could change at any moment.
After the president's erratic moves, stock indexes climbed, but the USD dropped 0.3%, bringing its total decline for 2025 to nearly 10%. In this environment, gold emerged as the big winner. Investors turned to safe-haven assets to hedge against potential risks. Many market participants now fear that the Fed may not withstand political pressure and may fail to control rising inflation, prompting them to seek backup strategies.
