Bitcoin holds above $86,000 as ETF inflows and lower rate-hike bets provide support

Bitcoin (BTC) is holding above the $86,000 level at the time of writing on Monday after gaining more than 12% over three consecutive weeks since mid-September.

Institutional demand continues to support Bitcoin’s bullish momentum, with spot Bitcoin exchange-traded funds (ETFs) recording their third consecutive week of positive inflows. Meanwhile, reduced expectations for a Federal Reserve interest rate hike in October, following a weaker-than-expected US employment report last week, continue to support the world’s largest cryptocurrency.

Institutional demand remains strong

Institutional demand for Bitcoin continues to support the cryptocurrency’s price. Data from SoSoValue showed that spot Bitcoin ETFs recorded inflows of $241.09 million last week, marking a third consecutive week of positive inflows and signaling strong demand for the cryptocurrency.

If this inflow trend continues and strengthens this week, Bitcoin could extend its current rally.

Lower rate-hike expectations support Bitcoin

Market participants have scaled back their bets on a Federal Reserve interest rate hike in October following the weaker-than-expected employment report.

Data from the US Bureau of Labor Statistics (BLS) on Friday showed that US nonfarm payrolls increased by 29,000 in September, following a gain of 133,000 in August, which was revised down from 162,000. September’s increase was also well below market expectations of 90,000 jobs.

According to the CME FedWatch Tool, the probability of Federal Reserve monetary policy tightening at the October meeting fell to 18.3% on Monday, compared with around 70% a week earlier.

Lower expectations for monetary policy tightening support risk assets such as Bitcoin, strengthening the prospects for the cryptocurrency’s bullish momentum to continue.