Bitcoin (BTC) crossed $87,000 on Monday, reaching an 8-month high of $87,397 amid renewed demand, forced short covering, spot Bitcoin ETF inflows, and improved market sentiment.

The flagship cryptocurrency jumped nearly 7% on Monday, reaching $87,397 before closing at $86,593. However, the price is down 1.40% during the ongoing session, trading around $85,396.

Bitcoin Eyes $90,000

According to Bloomberg, BTC extended its recovery by over $10,000 from the previous week’s lows, and is trading at levels last seen at the end of January 2026. The latest rally has been bolstered by renewed spot Bitcoin ETF demand and a substantial short squeeze as traders cover their positions.

However, Nicolai Sondergaard, Senior Research Analyst at Nansen, told crypto.news that despite the rally, Hyperliquid’s largest Bitcoin holders remained net short. Nansen also flagged that more BTC was moving to exchanges than leaving them, potentially raising the supply of BTC available in the market.

Sondergaard said:

“Bitcoin’s move above $84,000 looks less like a clean macro-driven accumulation event and more like a combination of renewed ETF demand and a large short squeeze. The important distinction is that price has turned bullish faster than positioning has.”

Sondergaard added that the rally could continue if under-positioned buyers keep buying BTC. However, price action could reverse if Treasury yields increase again or ETF inflows weaken.

Spot Demand Key For Bitcoin (BTC)

Spot demand has played a key role in driving BTC’s advance. Jeff Ko, Chief Analyst at ViaBTC, highlighted the Coinbase Premium, which returned to positive territory on Friday. This meant BTC traded at a higher price on the exchange than on other offshore platforms.

The index helps assess buying interest from American institutions and investors. Meanwhile, the USDT/USD pair rose from 0.9991 to 0.9998, which Ko said indicates genuine demand rather than one sustained by borrowed capital.

BTC’s rebound came after two major setbacks: the Federal Reserve increasing the benchmark interest rate by 25 basis points and the US Senate’s failure to advance the CLARITY Act. All 12 voting members of the Federal Open Market Committee supported the hike, with 16 officials projecting at least one more hike in 2026. As a result, BTC retreated towards $75,000, while Bitcoin ETFs reported substantial withdrawals.

The ETFs reported combined withdrawals of around $746.3 million on September 15 and September 16, before reporting $159.5 million in inflows on September 17 and $433 million on September 18.

Key Levels For Bitcoin (BTC)

According to Sondergaard, $87,000 and $90,000 are key levels for BTC. A clear break above $87,000 will bring the flagship cryptocurrency within sight of $90,000, a key psychological level. However, it may face resistance around $92,000 if it crosses this level.

“The next level to look for would be $87k, given $85k is broken and held; then $90k would be psychological, and again some levels to look for around $92k.”

However, BTC will need sustained spot buying to support a push above these levels, and it will need to avoid any macroeconomic shocks on the horizon. Sondergaard believes a lack of spot and ETF demand could bring perpetual futures into play, leaving BTC more vulnerable to geopolitical events and large sell-offs.

Technical indicators favor positive momentum for now. Earlier, BTC reclaimed its