Bitcoin’s (BTC) price performance in August resulted in 8.6% losses for the largest cryptocurrency, exacerbating the bearish sentiment in the market since it hit all-time highs of $73,7000 in March this year. Since then, BTC has failed to consolidate above key levels.
However, this may not be the end of the bearish momentum as recent analysis from research firm CryptoQuant suggests that the downtrend will continue into September.
Challenging September for Bitcoin
According to For CryptoQuant, the September outlook looks equally challenging for BTC. Their recent analysis highlights that August’s performance, marked by the so-called “BOJ (Bank of Japan) Fall”Early August, which took the token to a six-month low of $49,000, has left BTC unable to recover above the $65,000 mark since.
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Furthermore, historical data suggests that September is typically a rude month for Bitcoin, with six of the last seven Septembers closing in the red, with an average loss of around 4.5%. The firm believes that if this trend continues, the price of BTC could fall to around $55,000 by the end of the month.
Despite the pessimistic outlook, CryptoQuant believes the situation may not be as dire as it seems. They anticipate Bitcoin to find “strong support” around the $54,000 level, a price from which it successfully recovered in July before rallying to $70,000.
Long-term confidence indicator
In the coming days, the company warned to watch out for this week’s economic dataparticularly the September 5 jobless claims report and the September 6 nonfarm payroll (NFP) data.
However, CryptoQuant suggests that there are moderate expectations regarding the impact of these macroeconomic metrics on cryptocurrency prices, noting that their influence has diminished in recent weeks.
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Furthermore, the volatility curve for Bitcoin is expected to increase as short-term volatility subsides. Interestingly, there is evidence of continued bullish sentiment in the medium term despite recent pullbacks, as traders launch long call options for Bitcoin and Ethereum (ETH).
For example, a notable purchase of a 200x call option on Bitcoin expiring in March 2025 with a strike price of $120,000 increased its open interest to 2,100 contracts. This indicates that despite the current market conditionsThere is still a strong belief among some investors that Bitcoin will appreciate in value in the long term.
At the time of writing, the largest cryptocurrency on the market is trading at $58,400, down 0.2% over the past 24 hours and 5.5% over the past 30 days. Despite these ongoing price corrections, CoinGecko data shows that BTC is still up 126% since the start of the year, making it one of the best performing tokens.
Featured image of DALL-E, chart from TradingView.com