Bitcoin gave back earlier gains after Federal Reserve Chair Warsh struck a hawkish tone at the Jackson Hole symposium. On Friday, BTC fell to as low as $76,877 from an overnight high of $81,455 and later settled at $77,557, a 3.39% daily decline.
The drop followed a week in which Bitcoin had at one point posted a double-digit gain. That advance stalled once again in the $81,000 to $82,500 resistance zone.
September rate-hike odds climbed after Warsh comments
Warsh said U.S. inflation was still not cooling fast enough and that the Federal Reserve "still has work to do" before achieving its 2% inflation goal. Markets reacted by sharply raising expectations for a September rate hike.
According to CME FedWatch data, the probability of a September increase rose to 55.7% from 35.4% the previous day.
Liquidations hit leveraged crypto positions
The hawkish shift also triggered a wave of liquidations in leveraged crypto trades. Across the broader market, about $481 million was liquidated over the past 24 hours, with long positions accounting for more than $360 million.
Bullish longer-term positioning remains intact
Despite Friday's retreat, longer-term bullish sentiment has not clearly reversed. Prediction market data shows traders still assign a 77% probability that Bitcoin's next major target will be $84,000, compared with a 23% probability of a decline to $55,000. Friday's correction did not change that split.
On the fundamental side, U.S. spot Bitcoin ETFs had logged net inflows for eight straight trading days through Wednesday, attracting about $2.8 billion in total. That marks the longest consecutive inflow stretch since April.
Key technical levels remain in focus
From a technical standpoint, Bitcoin's RSI stood at about 69.7, still below the extremely overbought levels that had triggered pullbacks before. If BTC weakens further, the $73,670 to $75,157 range is seen as an area bulls are likely to defend. A move back above $81,000 to $82,500 would be key to reopening room for fresh highs.
In the near term, Warsh's softer forward guidance leaves the market without a clear policy path before the next rate-setting meeting. Bitcoin may continue to see sharp swings as inflation data and interest-rate expectations change.