Pinched what i think was a mole. top layer came off. bled. skin half an inch away from it itches. what could be causing it? cancer? irritation?

Healing: Normal healing will cause itching for a limited time. If this was a mole it will help to take a picture of it now and monitor in time. If any significant change in size or color seek medical attention for further instructions.

We can't give you: an accurate diagnosis with the available information. Sounds lke you irritated the tissue regardless. Give it a chance to heal. I encourage head to toe evaluation of skin annually for adults. The only way to say what this is for certain is through evaluation.