Will Bitcoin Break Free from September’s Historical Weakness in 2024?
As September 2024 begins, investors are anxiously pondering whether Bitcoin will overcome its historically weak performance during this month. A recent study by QCP Capital suggests that despite Bitcoin’s usual struggles in September, this year might be different, with potential price targets exceeding $65,000.
Bitcoin Could See a September Rally
According to QCP Capital, Bitcoin ended August with an 8.6% decline, driven largely by an early-month crash from which the cryptocurrency failed to recover. Historically, September has been challenging for Bitcoin, recording its largest losses in six of the past seven Septembers, with an average drop of 4.5%. If this trend continues, Bitcoin’s price could dip to around $55,000 this month.
However, QCP Capital highlights a strong support level at $54,000, which served as a critical rebound point in July, potentially preventing further declines and setting the stage for a price recovery.
Interestingly, despite the generally bearish seasonal trends, QCP Capital points to signs of structural bullishness in the medium term. This optimism is reflected in market activities, such as the recent purchase of significant BTC call options set to expire in March 2025, indicating that some investors are preparing for substantial price increases in the coming months.
Market Conditions and Future Outlook
It’s crucial to consider the broader macroeconomic environment. Although the impact of upcoming economic data, like unemployment claims and non-farm payroll reports, on cryptocurrency prices has diminished, these factors still have the potential to influence market sentiment.
Bitcoin’s price target of $65,000 in September is further supported by on-chain data, suggesting that this month may not be as bearish as usual. The WaveNet deep learning model, which has accurately predicted Bitcoin price movements in the past, indicates a 50% chance that Bitcoin will surpass the $65,000 mark in September, despite the typical seasonal weakness.
Earlier this year, Bitcoin faced significant downward pressure due to widespread sell-offs, including the German government’s sale of nearly 50,000 BTC. However, with these sales largely concluded, the market may be poised for a recovery. Additionally, long-term cryptocurrency holders increased their holdings by 262,000 BTC last month.
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Moreover, while August ended on a bearish note, September has only continued the downtrend in four of the past seven years. In the other three years, Bitcoin reversed its course and recorded positive returns.
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