Bitcoin Soars 14% to $124K as U.S. Demand and Fed Shift Ignite Bullish Frenzy

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• Bitcoin surged 14% in a week, nearing $124,000 amid strong U.S. demand.
• Onchain data shows a $1.6B buy spike and a $92 Coinbase premium gap.
• Analysts see resistance at $130K but expect price discovery in Q4.

Bitcoin (BTC) has surged nearly 14% over the past week, reaching highs just shy of $124,000, as renewed U.S. demand and easing Federal Reserve policies boosted investor confidence. The rally pushed the total crypto market cap above $4.2 trillion, signaling a strong risk-on appetite despite a U.S. government shutdown.

Bitcoin’s climb from last week’s lows near $108,600 reflects a sharp rebound in market sentiment. Analysts suggest that this surge could push the world’s largest cryptocurrency into price discovery above $125,500, a threshold that could unlock new all-time highs.

U.S. Government Shutdown Fuels Bitcoin’s Momentum

Surprisingly, the ongoing U.S. government shutdown has strengthened Bitcoin’s appeal as investors seek alternatives amid policy uncertainty. Federal agencies have paused data releases, complicating the Fed’s decision-making and increasing speculative activity in crypto markets.

According to Bitfinex analysts, Bitcoin’s current rally “appears genuinely organic.” They pointed to former President Donald Trump’s talk of potential stimulus checks as an additional bullish catalyst, echoing the post-pandemic crypto boom. Meanwhile, steady ETF inflows and a dovish Fed are creating favorable macro conditions for Bitcoin’s advance.

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Onchain Data Confirms Strong U.S.-Led Demand

Onchain indicators underscore the scale of U.S. participation in this rally. Analyst Maartunn reported a $1.6 billion spike in taker buy volume across exchanges in just one hour — a rare sign of aggressive accumulation.

Meanwhile, the Coinbase Premium Gap — the difference between BTC prices on Coinbase and Binance — jumped to nearly $92, its highest since August. This suggests U.S. buyers are paying a significant premium for Bitcoin, reflecting strong domestic demand. However, historically, such spikes have sometimes preceded short-term cooldowns.

Outlook: Price Discovery and Key Resistance Levels

Traders are now watching whether Bitcoin can hold $120,000 as support through the weekend. Analysts expect a possible price discovery phase next week if momentum continues.

Crypto trader Rekt Capital described the current stage as “Phase 3” of the market cycle — where Bitcoin tests new highs. However, analysts caution that heavy sell orders near $130,000 could act as the next resistance barrier.

With U.S. investors leading the charge and the Fed’s tone turning supportive, Bitcoin appears well-positioned for a strong Q4 performance. While resistance near $130,000 may test its strength, the combination of macro tailwinds, ETF inflows, and organic demand could soon push BTC into uncharted territory.

Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.