Bitcoin Surges Past $116K Despite U.S. Government Shutdown: Is $120K Next?

Bitcoin blasted through $116,000 with a 3% daily gain even as the U.S. government officially entered shutdown, its first since 2018. The political stalemate over health-care funding has 750,000 federal workers on furlough and could cost about $400 million per day, yet risk assets shook off early nerves.

Bitcoin ETF Inflows, “Uptober” Tailwinds, and a Bull-Flag Setup

Fueling the rally, U.S. spot Bitcoin ETFs attracted $3.53 billion in net inflows in September, topped by $429.9 million on Sept. 30 (BlackRock, Ark, Fidelity leading).

On-chain and derivatives data indicate healthy conditions as leverage resets after the decline, funding levels normalize, and open interest remains steady, allowing BTC to resume its upward trend.

Technical analysts point to a multi-week bull flag with the price now pushing against the upper boundary, mirroring patterns seen before previous impulsive moves. Seasonality also favors the market, with “Uptober” traditionally showing strong performance after a positive September close.

Telegram’s Pavel Durov even revived long-term optimism, reaffirming a $1 million BTC target driven by fixed supply versus money printing, sentiment often seen during mid-cycle expansions.

Bitcoin’s Key Levels to Watch Out

In the near term, Bitcoin resistance is around $117,500. A clear reclaim and daily close above this level could pave the way toward $119,300–$120,300, with a psychological target near $ 120,000.

Order-book heatmaps indicate significant short liquidity between $118,000 and $119,000 (about $7 billion), which could trigger a squeeze if this level is broken.

On the downside, bulls aim to defend the $114,800–$115,200 zone first, then the $112,000 pivot identified before the bounce; below that, there’s a larger liquidity pocket at $107,000–$108,000 (roughly $8 billion in long liquidations).