Bitcoin Ends Historic September With a Dip, but Breakout May Not Come Before U.S. Election

Cryptocurrencies
fell
sharply
on
Monday
with
bitcoin

(BTC)
nearing
the
$63,000
level
during
the
U.S.
session,
finishing
on
a
sour
note
of
what
otherwise
was
a
surprisingly
stellar
September
for
digital
assets.

Crypto-related
stocks
also
got
slammed
lower,
with
multiple
bitcoin
miners
including
Marathon
Digital
(MARA),
Bitdeer
(BTDR),
Hut
8
(HUT)
and
CleanSpark
(CLSK)
plunging
5%-10%.
Crypto
exchange
Coinbase
(COIN)
fell
over
6%,
while
MicroStrategy
(MSTR)
was
more
than
3%
lower
shortly
before
the
close
of
trade.

A
look
at
traditional
markets
show
U.S.
equity
indexes
flatlined
for
most
of
the
day
before
heading
lower
towards
the
later
hours
of
the
session,
while
key
European
markets
sold
off
1%-2%.
Japan’s
incoming
prime
minister
Shigeru
Ishiba
said
that
“monetary
policy
must
remain
accommodative
as
a
trend,”
according
to
a

Reuters
report.
His
comments
came
after
his
surprise
weekend
elevation
to
the
PM
role
set
off
a
5%
plunge
in
the
Nikkei
on
Monday.

In
the
U.S.,
Federal
Reserve
Chair
Jerome
Powell
tempered
expectations
on
Monday
that
future
rate
cuts
will
be
as
aggressive
as
September’s
50
basis
point
cut.

“Looking
forward,
if
the
economy
evolves
broadly
as
expected,
policy
will
move
over
time
toward
a
more
neutral
stance.
But
we
are
not
on
any
preset
course,”
Powell

said.
“The
risks
are
two-sided,
and
we
will
continue
to
make
our
decisions
meeting
by
meeting.”
“Overall,
the
economy
is
in
solid
shape,”
he
added.
“We
intend
to
use
our
tools
to
keep
it
there.”

Even
with
today’s
dip
in
crypto
prices,
bitcoin
is
on
track
to
finish
with
a
solid
positive
return
in
September
despite
its
reputation
for
being
an
adverse
month.
BTC
was
up
just
shy
of
7%
through
the
month
at
prices
a
few
hours
before
UTC
midnight,
booking
its
best
September
performance
since
2013,
per

CoinGlass
data.

September’s
positive
return
could
bode
well
for
October,
with
every
previous
green
September
having
been
followed
by
more
gains
the
next
month.
October
is
also
historically
one
of
the
strongest
months
for
bitcoin,
earning
its
nickname
“Uptober,”
by
recording
positive
monthly
returns
9
times
out
of
11
since
2013.

However,
Charlie
Morris,
founder
of
investment
manager
ByteTree,
contemplated
whether
the
expectation
of
a
strong
October
is
so
widespread
that
it
may
throw
a
curveball
to
investors.

“The
contrarian
will
always
be
cautious
of
an
idea
that
has
become
too
popular
because
popularity
means
the
money
is
already
invested
ahead
of
the
event,”
Morris
wrote
in
a
Monday
report.

His
report
further
noted
that
BTC’s
price
historically
consolidated
for
roughly
six
months
after
halvings
before
making
new
highs,
and
the
current
price
action
is
in
line
with
that
pattern.
Given
that
this
year’s
event
happened
on
April
19,
a
breakout
to
new
highs
may
happen
towards
the
end
of
October
if
the
pattern
holds
up.

Options
traders,
however,
expect
that
a
bigger
rally
will
only
come
after
the
U.S.
elections
in
November,
and
are
thus
positioning
for
further
weakness
in
the
coming
weeks,
according
to
Jake
Ostrovskis,
OTC
trader
at
crypto
market
maker
Wintermute.

“With
spot
trading
dipping
below
$65,000,
the
volatility
surface
indicates
a
bias
toward
the
downside
until
late
October
and
November,
when
the
market
begins
to
favor
calls
over
put
protection,”
Ostrovskis
said.
“Current
positioning
suggests
support
for
a
post-election
rally.”