Historical data suggests that Bitcoin’s (BTC), price could drop further in September. This is the worst month for crypto assets since 2013.
The data available shows that the digital asset’s flagship has seen its value decline in only two Septembers between 2013 and 2021. These were in 2015, and 2016. BTC’s monthly average decline has been 6%, outside of those two.
Bitcoin Monthly Returns
The September effect isn’t limited to BTC. Since 1928, the S&P 500 also experienced downturns most of September.
The average September decline for the S&P 500 was 1.1% between 1928 and now. Experts believe that investors’ behavior is responsible for the market decline in September.
Source: Jeroenblokland Blog
Elena Dure says that most investors exit their market positions in September in order to lock in gains and tax losses at the end of the year.
Asset liquidation rates are higher when schools resume in September and cash is needed to pay school expenses.
It is not surprising that the BTC price will continue to fall this month, given how closely it has mirrored S&P’s performance since the pandemic.
Is September going to be different?
Many investors want Bitcoin to return to its previous highs. However, there is a possibility that Bitcoin will turn red in September after it lost all of its gains over the past few months.
BTC’s value dropped below $20,000. This is after weeks of trading in the $20,000 area and analysts suggesting that it might have bottomed. The cryptocurrency’s value has fallen by 1.4% in the past 24 hours and 2.2% over the last seven days.
Bitcoin’s value has fallen by 59% in the past year.
Given the persistent conditions that cause asset values to decline, there is little chance of September 2022 becoming an anomaly month like 2015 or 2016.
Jerome Powell, Chairman of the Federal Reserve, warned that the United States would experience more pain as authorities battle to contain rising inflation.
Many experts believe that the FOMC will increase the interest rate in September, as a result of this statement.
The US Labor Department also revealed that the unemployment rate rose to 3.7%, which is the highest level since February. This is another indication of the economic struggles in the US.
Research: Since 2013, September has been the worst month to buy Bitcoin since 2013 CryptoSlate.