BTC price and September (or otherwise known as “rektember”) have historically not been a good mix.
The Bitcoin price pump from the Grayscale victory in the US Appeals court has disappeared following a 4.5% plunge.
The current bearish grip on the market is a result of the US Securities and Exchange Commission (SEC) decision to postpone the granting of all the pending spot Bitcoin ETF applications. Apart from that, September hasn’t been a particularly kind month to the benchmark cryptocurrency.
Bitcoin plummets following ETF grant delay
Bitcoin lost all its gains from the Grayscale pump as it fell from $28,000 levels to below the $26,000 price level after a 4.5% fall in the last 24 hours.
The close of August saw Bitcoin lose all its Thursday gain on news that the SEC will once again delay decision on the granting of pending ETF applications for 45 days.
“After plenty of push & pull this week, Bitcoin has returned to $26K, right back where it started prior to the Grayscale news boosted crypto markets,” blockchain analytics firm Santiment said.
BTC price and September (or otherwise known as “rektember”) have historically not been a good mix. On the first day of the month, Bitcoin is already looking to close the day below the crucial $500B market capitalization.
Data from TradingView reveals that Bitcoin is giving a strong sell signal on the daily time frame. The price is underperforming on all important moving average indicator, with heavy selling pressure pushing the price to $25,896 at press time.
On-chain data from Coinglass also shows that BTC open interest that was added over the week have been fully wiped out.
Market experts are predicting more sell-offs as S&P 500 also goes red in the month of September. S&P losses in September have been at an average of 3.2% for the past five years.
Experts aren’t optimistic
While Bitcoin bulls are optimistic that the SEC will have no choice but to grant the ETF applications in a few weeks, market analysts are less positive about the tidings of the month.
In a series of tweets, Rekt Capital explained, “BTC closed below ~$27,150, confirming it as lost support. It’s possible BTC could rebound into ~$27,150, maybe even upside wick beyond it this September. But that would likely be a relief rally to confirm ~$27,150 as new resistance before dropping into the $23,000 region.
Rekt Capital delves deeper into this trend, stating, “A frequently recurring downside amount for BTC in the month September is -7%. If BTC were to drop -7% from current price levels this month, price would retrace to ~$24,000.”
In historical context, Bitcoin has always recorded the least positive return. The month is currently in its sixth year of negative return streak. Even when Bitcoin was on a bull run in 2021, the price plunged in September of that year.
“Even in 2021, during the final upward leg of the last bull cycle, Bitcoin lost 7% in September only to gain 40% the following month,” Noelle Acheson, author of Crypto is Macro Now and former head of market insights at Genesis, wrote in a newsletter Friday.
“Times are different now, however. In September 2021, bond yields were around 1.1%, the S&P 500 was up a whopping 40% year-to-date, risk sentiment was high and BTC had already gained over 60% since early January,” Acheson added.
An hawkish Federal Reserve is also expected to release its next interest rate decision on September 20. The market is betting on a probable pause and keep interest rates at around 5.2% move by the Fed.
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