Bitcoin Holds Key Zones as Softer US Inflation Sparks Market Optimism

Bitcoin’s price action sits on a knife-edge, trading between crucial support near $111,000 and resistance close to $117,000, amid growing market optimism following softer than expected US inflation data.

The September Consumer Price Index (CPI) rose just 0.3%, below forecasts, bringing renewed hopes of a future Federal Reserve easing and igniting surges in broader equities markets such as the S&P 500 and Nasdaq.

However, despite this positive macro backdrop, Bitcoin remains confined within well-defined technical boundaries as traders await a clear breakout signal.

Market Sentiment Brightens, Risk Appetite Returns

Data from CryptoQuant indicates that the easing inflation has triggered a “fast adjustment followed by realignment” across global markets.

Traders quickly lifted asset prices initially, then entered a cautious consolidation phase.

While traditional equities have rallied strongly, Bitcoin’s momentum appears muted by comparison.

CryptoQuant highlights that risk appetite is indeed returning but remains largely concentrated in conventional assets, as crypto investors hold back, looking for more concrete macroeconomic or liquidity validations before committing additional capital.

Analyses based on on-chain data from Glassnode, referenced by market commentators, reveal Bitcoin's current equilibrium.

The Cost Basis Distribution Heatmap identifies $111,160 as a major support zone and $117,630 as critical resistance.

These levels mark the areas where trading activity and historical accumulation are densest, effectively forming the battleground for the cryptocurrency’s next directional move.

Institutional Hesitancy and Outlook

Despite improved economic indicators, institutional engagement in Bitcoin remains subdued.

CryptoQuant’s data shows that large inflows—crucial drivers for past Bitcoin bull runs—have yet to resume meaningfully.

This continued restraint reflects an ongoing uncertainty about global monetary policy directions, even though inflation signals point to stabilization.

Analysts suggest that Bitcoin must maintain its support near $111,000 and break through resistance around $117,000 to ignite a fresh bullish phase.

Until then, the market is likely to remain range-bound, with price swings driven more by broader economic factors than crypto-specific events.

In summary, Bitcoin is consolidating cautiously as broader markets cheer easing inflation.

The digital asset stands ready for a breakout but awaits stronger commitment from major investors and clearer macro cues to fuel its next rally.