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Bitcoin sees big overnight rally as ETF demand returns before the next US jobs test

Bitcoin retook $86,000 by the morning of Oct. 2 as demand for US spot Bitcoin ETFs recovered, with short covering a plausible accelerator for the advance ahead of the US jobs report.

Bitcoin traded at $86,325.44 at 08:40 UTC, up 3.67% over 24 hours. The advance carried it beyond the Sept. 30 rebound above $85,000 that faded below $84,000 after US inflation data.

The ETF reversal gives the recovery support beyond leveraged traders closing bearish bets. Reported short liquidations offer a mechanism for accelerating an existing advance. The initial trigger remains unclear because daily fund flows and rolling liquidation figures cover different windows, but the combined evidence supports an explanation built around renewed buying interest and forced short exits.

Coinbase’s BTC-USD market offered a view of the size of the move: at 08:42 UTC, its rolling 24-hour range ran from $83,353.87 to $86,885.28, with the last trade at $86,377.70. Ether, XRP and Solana also advanced in CryptoSlate’s market rankings, placing Bitcoin’s recovery within a broader rise in major cryptocurrencies.

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ETF demand returned after an outflow day

US spot Bitcoin ETFs recorded net inflows of $102.7 million on Oct. 1, according to Farside Investors’ ETF flow data. That followed net outflows in the previous session.

The positive aggregate concealed a mixed picture across products. BlackRock’s IBIT fund attracted money even as Fidelity’s FBTC fund and several other ETFs recorded redemptions. Demand recovered because inflows exceeded those withdrawals.

The return to net inflows weakens the case that the previous session’s redemptions marked the start of a sustained withdrawal. Continued inflows would make that support more durable; redemptions at other funds show why one positive total is still a limited signal of investor commitment.

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Leverage could amplify an existing rise

CoinGlass’s Bitcoin trading data showed about $70.58 billion of Bitcoin futures turnover over 24 hours in its 08:42 UTC reading, compared with about $6.35 billion in spot turnover across its tracked markets. It also reported about $135.47 million in liquidated Bitcoin futures positions.

Turnover measures trading activity and includes repeated transactions. These figures establish substantial derivatives participation without measuring fresh capital entering Bitcoin.

In its Oct. 2 estimate of Bitcoin futures liquidations over 24 hours, CoinNess said 91.13% involved short positions. That reported imbalance is consistent with forced exits from bearish bets accelerating an already rising market.

As Bitcoin rises, losses on leveraged shorts can exhaust the collateral supporting them. Closing those positions can add buying pressure, creating a feedback loop that helps an advance gather speed.

Forced covering can help a rally travel quickly. Its effect fades as vulnerable positions close, leaving continued buying to determine whether the higher price holds.

Inflation and payrolls still test the recovery

Inflation remains an obstacle to the recovery, even if the Fed takes more time to assess its next move.

The August PCE report released Sept. 30 put core inflation at 0.2% month over month and 3.0% year over year. Headline inflation was 0.3% monthly and 3.4% annually. Released two days earlier, those readings formed the backdrop to the latest overnight advance.

Fed Vice Chair Philip Jefferson said on Oct. 1 that assessing future policy adjustments could take more time. His remarks leave room for policy patience, but he also highlighted upside inflation risks and recalled September’s quarter-point rate increase to 3.75% to 4%.

Meanwhile, ISM’s September manufacturing report, issued Oct. 1, showed its prices index rising to 77.9 from 71.1 while the manufacturing PMI remained expansionary at 54.5. Cost pressures were still broadening.

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September’s US jobs report is scheduled for 12:30 UTC on Oct. 2, making it the next test of whether Bitcoin can retain $86,000. The figures arrive after the overnight advance.

Holding above $86,000 alongside further ETF inflows would strengthen the case for continuing demand. A quick reversal would repeat the earlier failed breakout’s weakness. Returning fund demand has improved the rally’s foundation; holding the recovered level through payrolls would show whether that support can withstand the next macroeconomic test.

The post Bitcoin sees big overnight rally as ETF demand returns before the next US jobs test appeared first on CryptoSlate.