BTC Slides Below Important Support as Dollar Rally Builds Ahead of Powell Speech

Bitcoin (BTC) fell below $121,500 Thursday, breaking a crucial support level and the 200-hour moving average, as the broader crypto market pulled back and the U.S. dollar gained strength ahead of Federal Reserve Chair Jerome Powell’s speech. ETH and BNB dropped over 3%, while the CoinDesk 20 Index slid 1% to 4,155 points.

The decline followed another strong day of inflows into U.S.-listed spot ETFs, which added $426 million on Wednesday, continuing a week-long streak of robust investment, according to SoSoValue.

The dollar index climbed to 99.10 — its highest since August 1 — weighing on dollar-denominated assets like Bitcoin and gold. Gold briefly fell to $4,000 per ounce before recovering above $4,030.

Powell Speech in Focus
Powell is scheduled to speak at the Community Bank Conference in Washington at 12:30 GMT. Traders are seeking guidance on monetary policy, especially as the ongoing government shutdown has stalled key U.S. economic data, including inflation and employment figures.

Fed Minutes Highlight Caution
Minutes from the Federal Reserve’s September meeting revealed concerns about policy decisions in the absence of fresh data. “Should the shutdown not end by the FOMC’s Oct. 28-29 meeting, policymakers essentially will be flying blind on key economic metrics,” the committee noted.

While officials largely agreed that additional rate cuts are likely appropriate, there was debate over their pace. The FOMC voted 11-1 to lower the federal funds rate by 25 basis points to roughly 4%, with a majority expecting at least two more cuts this year, potentially taking rates down to 3.50–3.75%. Discussions also highlighted a weakening labor market and early inflation signals, though members generally saw Trump’s trade tariffs as unlikely to cause lasting inflation.