Bitcoin Could Aim for a Bullish September

As September 2024 begins, investors are on edge, wondering if Bitcoin will break free from its historically weak performance during this month.

As the dust settles on a bearish August, investors are eagerly anticipating Bitcoin's performance in September, a month that has historically posed challenges for the leading cryptocurrency.

While Bitcoin closed August with an 8.6% loss, largely driven by a sharp sell-off early in the month, it faces further obstacles in September. Historically, the largest cryptocurrency has recorded losses in six of the past seven Septembers, averaging a 4.5% decline.

Should this trend hold, Bitcoin could experience a price drop to around $55,000 this month. However, strong support around the $54,000 level, which served as a critical bounce point in July before Bitcoin surged toward $70,000, could prevent steeper declines and set the stage for a price recovery.

Despite the overall bearish seasonality, there are signs of structural bullishness in the medium term, according to QCP. This optimism is evident in market activities, such as the rolling out of long Call options for both Bitcoin and Ethereum until March.

Notably, a large number of BTC Call options, set to expire in March 2025, were recently purchased, indicating that some investors are positioning themselves for significant price increases in the coming months.

However, it is important to note the macroeconomic environment and how economic data releases slated for this month, such as the Unemployment Claims and Non-Farm Payroll reports, could still influence cryptocurrency prices, despite their diminishing impact over recent times.

Furthermore, on-chain data provides further evidence that September might not be as bearish as usual. The WaveNet deep learning model, which has accurately predicted Bitcoin's price movements in the past, forecasts a potential price bounce this month.

The model assigns a 50% probability that Bitcoin will surpass the $65,000 mark in September, defying the typical seasonal weakness.

This potential bullish reversal is also supported by reduced selling pressures, as reported earlier by The Crypto Basic. While Bitcoin faced significant downward pressure due to large-scale selloffs earlier this year, including the German government's sale of nearly 50,000 BTC, these sales are now largely complete.

Moreover, long-term holders have increased their supply by 262,000 BTC in the past month. Interestingly, when August ended on a bearish note, only four of the last seven Septembers continued the downward trend. In the other three years, Bitcoin reversed course and posted positive returns.