BTC Inches Up While ETH Reclaims $4K Amid Growing Investor Caution

Crypto Markets Tick Higher as Inflation Meets Expectations, But Fear Persists – 27/9/2025

Crypto markets showed modest gains on Friday, with Bitcoin climbing back above $110,000 to $113,012.67, and Ethereum outperforming with a 3.8% rise to $4,107.93. Dogecoin added 3.4% to $0.2271, while Solana gained 2.5% to $205.44.

The rally followed U.S. inflation data that matched forecasts. The Federal Reserve’s preferred measure, the Personal Consumption Expenditures (PCE) index, rose 2.7% year-over-year in August, while core PCE, excluding food and energy, increased 2.9%.

Fabian Dori, CIO at Sygnum Bank, said the report reinforces the Fed’s narrative of easing price pressures but leaves policymakers balancing persistent inflation with a softening labor market. “Lower inflation could support risk assets through confidence in the Fed’s easing cycle, but any upside surprises may delay rate cuts, putting pressure on equities and boosting the U.S. dollar,” he explained.

Crypto Sentiment Shows Extreme Caution
Despite the bounce, sentiment remains fragile. The Fear & Greed Index fell to 28, its lowest since mid-April, reflecting ongoing trader caution following Thursday’s $1.1 billion liquidation wave that wiped out leveraged long positions.

Matt Mena, strategist at 21Shares, noted that roughly $3 billion of leveraged longs have been liquidated recently, leaving markets extremely bearish. “Popular tokens such as BTC, SOL, and DOGE now show a long-to-short ratio of just one-to-nine,” he said, adding that this could set the stage for a potential short squeeze.

However, some analysts remain cautious. Paul Howard, senior director at trading firm Wincent, pointed to BTC dipping below its 100-day moving average under $110,000 and the total crypto market cap falling below $4 trillion as signs of weakness. “The market is in a healthy correction without panic or sharp volatility,” he said. “It is likely to grind lower over the coming weeks, and whether crypto revisits 2025 record highs is now uncertain.”

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