September Outlook: Will the Crypto Market Repeat Last Year's Mini Bull Run?

Author: Climber, Jinse Finance

On September 4, the cryptocurrency market experienced another decline. BTC dipped to around $55,600, and altcoins fared even worse, with declines approaching last year's bear market levels. Opinions on the market trends for the last four months of this year vary among institutions and celebrities, with differing short-term and long-term investment recommendations.

However, overall, the key factors likely to influence the cryptocurrency market in the future include: Federal Reserve interest rate cuts, the election, SEC regulatory strategies, FTX debt repayment schedules, the performance of U.S. stocks and tech stocks, the flow of funds into U.S. Bitcoin ETFs, and halving cycles. Especially under the expectations of interest rate cuts and halving, many investors and institutions have adopted an early layout strategy, although some analysts still caution about short-term risks, suggesting that BTC could pull back to the $40,000-$50,000 range.

In this regard, Jinse Finance has collected and organized the views of representative institutions and celebrities, as well as recent positive and negative events, in hopes of providing a clearer understanding of the future cryptocurrency market situation.

Bullish and Positive Events

Bullish:

ETC Group Research Director: The non-liquid supply of Bitcoin has reached 74% of the total supply, setting a new historical high, indicating that the supply shock triggered by the halving is actually intensifying, which will bring increasing momentum to Bitcoin and other crypto assets in the coming months.

Grayscale: If the dollar weakens and interest rates continue to decline, it will be favorable for Bitcoin. The main downside risk for crypto valuations is a further rise in unemployment and a potential recession, but U.S. policymakers will begin to ease and promote consumption when signs of economic recession appear.

Rekt Capital Analyst: Bitcoin's historical performance in October is usually very strong. Data shows that Bitcoin only experienced declines in October 2014 and 2018, both of which were bear market years. Currently, the market is in a Bitcoin halving cycle year. Historically, Bitcoin has only seen single-digit gains in October 2018 (also a bear market year). Besides that, October typically brings double-digit gains, with an average increase of 22%.

Crypto Analyst Titan of Crypto: Bitcoin's price is expected to reach $110,000 by 2025. Bitcoin is forming a "cup and handle" pattern, which is a bullish chart pattern suggesting that prices may rise in the future. The BTC peak is expected to occur in Q4 2024, potentially reaching $100,000 in Q1 2025.

Bitfinex Analyst: A 25 basis point rate cut could signal the start of a typical easing cycle, while a more aggressive 50 basis point cut could cause Bitcoin prices to soar immediately, but with increasing concerns about economic recession, a pullback may follow.

QCP Capital: Bitcoin may have strong support at $54,000, and the options market still shows mid-term bullish signals. The report also mentioned that this week's unemployment claims data (September 5) and non-farm payroll report (September 6) may not have a significant impact on cryptocurrency prices, as recent macroeconomic data has had a diminishing effect on cryptocurrencies.

Analyst: Glassnode data shows that Bitcoin's average hash rate has been steadily increasing over the past year and is expected to see significant growth in 2024. Historically, hash rate typically aligns with Bitcoin's price movements, reflecting miners' confidence and more optimistic market sentiment.

CryptoQuant Analyst: On-chain metrics, specifically the Bitcoin Puell Multiple index, indicate that Bitcoin is nearing "favorable" buy levels. Additionally, the low price of Bitcoin's hash rate may suggest that BTC prices are close to the bottom.

Glassnode: The net realized profit/loss indicator for Bitcoin has stabilized in the second half of this year, indicating that as the market matures post-halving, a balance has been reached between profits and losses.

Real Vision Chief Crypto Analyst: Bitcoin could reach $150,000 by the end of 2024, with its price trend expected to enter a "crazy season."

Positive Events:

Russia allows the use of cryptocurrencies for international trade.

The U.S. SEC no longer seeks to restart hedge fund trading fee disclosure rules.

Zurich State Bank launches Bitcoin and crypto products.

Metaplanet partners with Japanese financial giant SBI's crypto division to continue accumulating Bitcoin. Metaplanet has acquired 360 Bitcoins ($207 million) so far, using its primary reserve assets as collateral to enhance its ability to secure equity and debt financing.

Data shows that the U.S. spot Bitcoin ETF had a net inflow of 975 BTC in August, with the number of addresses holding over 100 Bitcoins reaching 16,120, a new high in 17 months.

Venezuelan President proposes to revisit the cryptocurrency path, potentially adopting a more crypto-friendly stance in the future.

Cryptocurrency losses in August fell to a historical low of $15 million.

Starbucks accepts Bitcoin as a payment method in El Salvador.

Greeks.live macro researcher: The cryptocurrency market is entering a correction trend, with whale users starting to position for long trades, and a surge in large bullish options, with expirations concentrated at the end of September and October.

Bearish and Negative Events

Bearish:

BitMEX Co-founder Arthur Hayes: If interest rates rise again and market liquidity tightens, Bitcoin may face another pullback.

Trader T: Institutional investment in Bitcoin and its derivatives was not active in August, with MSTR-BTC data showing bullish sentiment at +1.1x and bearish sentiment at -1.3x. MSTR-BTC sentiment refers to the market's view and expectations regarding the correlation between MicroStrategy (MSTR) stock and Bitcoin (BTC), indicating a certain degree of bias in the market's perception of MicroStrategy's correlation with Bitcoin.

Bitfinex Report: A 15-20% decline may occur during this month's rate cut, with Bitcoin's bottom potentially between $40,000 and $50,000.

Wolfe Research Analyst: Before a potential rise in 2025, Bitcoin may first pull back below $50,000. In the coming weeks, Bitcoin may return to the bottom of this range, around the $50,000 low area. Unless there are significant changes, the bearish outlook on Bitcoin's short to mid-term price will continue.

10x Research: Potential short squeezes may have recently driven up Bitcoin prices, but risks may arise in September.

BTC Markets Analyst: The cryptocurrency market may decline under the combined effects of various factors such as the "September Effect," portfolio rebalancing, tax loss harvesting, and heightened caution ahead of the U.S. elections.

Crypto data provider Kaiko: The cryptocurrency market is currently facing a severe oversupply issue, which may continue to suppress BTC prices. Other major holders may also exacerbate selling pressure in the near future. For example, the U.S. government holds over $2 billion worth of Bitcoin, and other countries, including the UK, China, and Ukraine, also have significant Bitcoin reserves.

Citigroup: Market flows into ETFs may continue to disappoint until the outcome of the U.S. economic landing becomes clearer.

Analyst Ali: Since June 22, BTC has struggled to break through $63,250. This price level often becomes a resistance point, as short-term holders are more likely to sell when prices fall below their entry points.

CryptoQuant: From a price perspective, if Bitcoin falls below $56,000, the risk of a larger pullback increases.

Negative Events:

Farside Investors data shows that the U.S. spot Bitcoin ETF experienced the largest outflow in nearly four months on September 3, with market sentiment low. Wall Street banks and hedge fund investors still held Bitcoin ETFs in Q2, but overall fund flows were weak.

Matrixport: Cryptocurrency trading volume in South Korea hit a year-to-date low last weekend.

Bitcoin miners' earnings in August reached a year-to-date low.

Victory Securities: Funding rates indicate stronger short positions in the contract market.

IntoTheBlock data shows that Bitcoin faces ongoing selling pressure between $61,700 and $70,500. As many traders are in a loss position in this price range, there is continuous selling pressure whenever Bitcoin approaches this level, with many investors seeking to break even. This is why Bitcoin struggles to reach new highs, as only strong momentum can break this trend to achieve new highs.

Spot on Chain data shows that Bitcoin's performance in September over the past 10 years has only been positive in 3 years.

The Block Pro data shows that adjusted on-chain total transaction volume for Bitcoin and Ethereum fell by 15.3% in August to $377 billion, with Bitcoin's adjusted on-chain transaction volume declining by 12.1% and Ethereum by 20.2%.

Summary

In terms of the comparison between bullish and bearish sentiments, bullish sentiment has not overwhelmingly covered bearish views. Currently, market perception leans more towards the risk of a decline before interest rate cuts, and several other significant factors such as the election, the U.S. economy, and regulation remain unclear, making the market direction susceptible to sharp fluctuations at any time. However, institutions generally remain optimistic about the long-term upward trend of the cryptocurrency market, and whales are quietly positioning themselves. In summary, ordinary investors still need to be cautious in the current situation and pay close attention to market changes.