NEW YORK — Bitcoin (BTC) maintained its position above the critical $118,000 support level on Thursday, July 31, 2025, as the cryptocurrency market navigated mixed signals following the U.S. Federal Reserve’s decision to keep interest rates unchanged. Despite a 3.8% dip in the overall crypto market capitalization, Bitcoin’s resilience underscored cautious optimism among traders, bolstered by sustained institutional demand and regulatory developments.
Market Dynamics and Fed Influence
The Federal Reserve’s announcement to hold interest rates steady, coupled with remarks from Fed Chair Jerome Powell on potential tariff-linked inflation, triggered $200 million in liquidations across the crypto market. Bitcoin, however, showed relative stability, trading at $118,479.18, up marginally by 0.07% in the past 24 hours, according to CoinMarketCap data. Analysts attribute this to Bitcoin’s ability to hold above the $117,000–$118,000 support zone, a key technical level on the 4-hour chart.
“Bitcoin’s price action reflects a market that’s digesting macroeconomic headwinds but remains supported by strong institutional inflows,” said Mitesh Shah, CEO of Omnia Markets. “The $117,000 level has proven to be a robust floor, and a breakout above $118,700 could pave the way for a retest of $122,000.”
The Fear & Greed Index, a measure of market sentiment, registered at 67/100, leaning bullish, driven by corporate buying and exchange-traded fund (ETF) activity. Trading volume surged nearly 20% in the last 24 hours, signaling active participation despite broader market fatigue.
Institutional Demand Fuels Bullish Outlook
Institutional interest continued to underpin Bitcoin’s momentum. MicroStrategy, a prominent Bitcoin holder, announced the acquisition of 21,021 BTC at an average price of $117,256 per coin, bringing its total holdings to 628,000 BTC, roughly 3% of the circulating supply. Similarly, Mara Holdings purchased $950 million worth of Bitcoin on July 30, further highlighting corporate confidence.
Bitcoin ETFs also saw significant inflows, with $6.74 billion poured into BTC-focused funds in July alone, compared to $10.53 billion for Ethereum-based ETFs. “The relentless inflows into spot ETFs, like BlackRock’s IBIT, which attracted over $13.7 billion this year, are absorbing a shrinking available supply,” Shah noted, citing on-chain data showing 70% of Bitcoin unmoved for over a year.
Michael Saylor, CEO of MicroStrategy, announced plans to raise $4.2 billion to further expand the company’s Bitcoin holdings, calling Thursday’s earnings call “the most important event in the history of Strategy.” The move sparked bullish sentiment, with Saylor predicting Bitcoin could reach $150,000 by year-end.
Regulatory Developments and Policy Support
Regulatory clarity also played a role in market dynamics. SEC Chair Paul Atkins expressed support for Bitcoin and crypto self-custody, stating, “The right to have self-custody of one’s private property is a core American value.” This stance aligns with recent policy proposals, including a White House crypto report advocating for a de minimis capital gains exemption for everyday Bitcoin transactions.
The U.S. House of Representatives’ “Crypto Week” earlier in July, which saw debates on crypto-related bills like the CLARITY Act, has fueled optimism about a potential regulatory framework. Analysts suggest that favorable legislation could further boost institutional adoption, with some projecting Bitcoin to hit $135,000 by mid-2025 if current trends persist.
Technical Analysis and Price Outlook
Bitcoin’s price action remains confined within a symmetrical triangle on the 4-hour chart, with support at $117,000 and resistance at $118,700. The Parabolic SAR indicates trend weakness, but the ascending trendline suggests bulls are defending key levels. A breakout above $118,700 could target $120,500–$121,664, while a drop below $117,000 may expose downside risks toward $114,600.
Long-term forecasts remain bullish. Finder.com’s panel of 24 crypto experts predicts Bitcoin will reach $145,167 by year-end 2025, with a peak of $162,353 and a potential low of $87,618. Some panelists, like Martin Froehler of Morpher, see BTC hitting $250,000, driven by institutional and nation-state adoption.
Broader Market Context
While Bitcoin dominates with a 61% market share, altcoins like Ethereum (ETH) also showed resilience, trading above $3,800. The total crypto market cap stands at $3.85 trillion, down from a July peak of $4 trillion. Analysts note that Bitcoin’s 90-day correlation with the VIX, a measure of market volatility, has reached a record 0.88, highlighting its sensitivity to traditional market dynamics.
Despite short-term uncertainties, including looming U.S. tariffs set to begin August 1, experts remain optimistic. “Bitcoin’s role as a store of value during geopolitical and macroeconomic stress is becoming undeniable,” said Ben Ritchie of Alpha Node Global, maintaining a $160,000 forecast for 2025.
Looking Ahead
As Bitcoin consolidates near $118,000, traders are eyeing the $122,000 resistance level, with potential to retest July’s high of $122,946. However, macroeconomic factors, including Fed policy and global trade tensions, could introduce volatility. Investors are advised to monitor on-chain flows and regulatory updates closely, with many emphasizing the importance of independent research given the market’s speculative nature.
Disclaimer: Cryptocurrency markets are highly volatile. This article is for informational purposes only and does not constitute financial advice. Always conduct thorough research before investing.