Bitcoin Surges to $117,000 Amid Macro Uncertainty: Nearing 2023 Highs

Bitcoin Price Climbs as Economic Conditions Favor Risk Assets

Bitcoin (BTC) surged to $117,000 on October 1, nearing its annual peak driven by falling U.S. Treasury yields and heightened macroeconomic uncertainty. Concerns over a potential U.S. government shutdown and weaker-than-anticipated private employment data catalyzed a shift toward risk-on assets, with growing speculation about rate cuts from the Federal Reserve further fueling optimism. Bitcoin’s breakout above the $115,000 technical resistance level established solid support at $117,000, sparking gains across major altcoins such as Ethereum (ETH) and Solana (SOL).

Weak Private Employment Data and Government Shutdown Spur Yield Declines

Key macroeconomic developments paved the way for Bitcoin’s rally. The latest ADP private employment report for September revealed a drop of 32,000 jobs, significantly missing market expectations of a 50,000 increase. This slowdown paired with the onset of a U.S. federal government shutdown on October 1, raising concerns about delays in crucial economic data releases.

The fallout pushed U.S. Treasury yields lower, with the 10-year note declining to 4.102% and the two-year proxy for short-term rate expectations retreating to 3.545%. Investors shifted their focus toward an anticipated Federal Reserve rate cut, with the CME FedWatch Tool indicating a 99% probability of a 25-basis-point reduction in October. While the U.S. dollar index remained flat, increasing economic uncertainties bolstered Bitcoin’s appeal as a viable alternative investment vehicle.

Bitcoin Breaks Critical Resistance, Altcoins Join the Rally

Bitcoin’s rally has been supported by both technical indicators and market sentiment. CoinMarketCap data reports Bitcoin gaining 2.74% to $117,320, extending its impressive 5.3% September growth into October. The digital asset now sits just 5.7% below its all-time high of $124,100. Analysts attribute this upward momentum to speculation surrounding Bitcoin ETFs and institutional capital inflows.

Moreover, Bitcoin’s rise above key technical levels, including its 50-day ($113,594) and 100-day ($114,000) moving averages, reinforces optimism for a continued uptrend.

Ethereum (ETH) surged 4.23% to $4,331.28, recovering fully from recent bearish trends. Solana (SOL) outperformed with a 5.36% increase to $220.22, leading the short-term altcoin rebound. Other leading altcoins such as Dogecoin (+6.19%) and Cardano (+5.34%) also posted notable gains, underscoring growing confidence in the broader crypto market.

Futures and Derivatives Markets Echo Optimism

The CME Bitcoin futures market mirrored the strength of spot prices, with October contracts rising 2.64% to $118,225, November climbing 2.71% to $118,995, and December increasing 2.69% to $119,660. This performance aligns with the broader rally in Bitcoin’s spot market.

Ethereum futures also exhibited robust growth, with front-month contracts closing over 4% higher. Momentum surrounding Ethereum ETFs has fueled nearly $2 billion in cumulative institutional inflows, boosting bullish sentiment for ETH in both spot and derivatives markets.

Analysts Expect Prolonged Rally, Caution Against Short-Term Corrections

Market experts maintain optimism for a strong crypto rally in Q4, while remaining vigilant about short-term price corrections. Joel Kruger of LMAX Group highlighted Bitcoin’s historical strength in October, stating, “Bitcoin has risen in 10 of the past 12 Octobers,” reinforcing Q4 as a traditionally high-performing period for digital assets.

However, analyst Ash Crypto warned of overly aggressive positioning potentially triggering pullbacks. She cited $106,000 for Bitcoin and $3,800 for Ethereum as key levels for potential short-term corrections.

Providing a longer-term perspective, investor Lark Davis predicted the current crypto cycle could extend through 2026. Davis forecast Bitcoin’s price reaching $180,000 and Ethereum climbing to $12,000, suggesting that altcoins might experience significant gains during this cycle.

Steady Growth in Crypto Market Cap and Sentiment

As of October 1, the global cryptocurrency market cap recorded steady growth at $3.91 trillion, up 0.01% from the previous day. The 24-hour trading volume reached $211.4 billion, while Bitcoin dominance remained strong at 58.41%, reaffirming its leadership role within the crypto ecosystem. Ethereum held a 12.81% share of the market, underlining its prominence as the second-largest digital asset.

Meanwhile, the Alternative Fear & Greed Index, a key sentiment measure, stood at 42, reflecting “neutral” investor sentiment and stable interest in digital assets under macroeconomic pressure.

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