Bitcoin and the September Curse: Will This Time Be Different?

Bitcoin entered the final days of August with volatile two-way trading and a familiar seasonal question hanging in the air: will September continue to be a sluggish month or will it return to the growth trajectory of Q4? As of Wednesday, August 28, BTC was fluctuating around $112,900 after a month of trading tussles between buyers and sellers, both oscillating around the same range instead of breaking down the confidence. Macroeconomic expectations, market positioning, and the unique statistical fluctuations of Bitcoin are currently converging in a brief timeframe ahead of the Federal Reserve's policy meeting in September, making the upcoming weeks unusual. The Federal Open Market Committee (FOMC), the Fed's rate-setting body, will meet on September 16-17, and the futures market is currently pricing in a high likelihood of interest rate cuts, although officials continue to emphasize data dependence. Calculating Bitcoin's Performance in September Seasonality is the first lens that traders use to read price charts. Daan Crypto Trades has captured the general sentiment on X, noting a "volatile August" and pointing out a strange fact in history: "In the history of BTC, the price has never closed both August and September in the green." He provides a practical warning about why this is important: "Whether you believe in seasonality or not, what matters is whether many other people believe it too. And if enough people believe it, it can act as a self-fulfilling prophecy."

Independent datasets support caution around September. Aggregate data from CoinGlass shows that over the past 12 years, September has delivered an average negative return of about 3.8% for BTC, making it the worst month in history. In contrast, Q4, particularly October and November, often outperforms the average, a factor that helps explain why traders often seek to buy when prices drop at the end of Q3. However, there is still a silver lining. Throughout Bitcoin's history, September has closed in the green four times - most notably in 2015 and 2016, and once again in recent years. In 2023, BTC rose by 3.9%, followed by a 7.3% increase in 2024.

This week, Anthony Pompliano provided a broader perspective, starting with a simple yet rigid statistic: "September is actually the only month of the year historically that is negative." He argued that the gloomy situation at the end of summer is partly due to investor behavior—"Everyone is on vacation... not sitting in front of a screen"—and partly due to unresolved macro questions from traditional finance. "There is still a lot of uncertainty," he said, even as "Jerome Powell announced that he may cut interest rates in September." While the market quickly priced in that outcome after the speech at Jackson Hole, Fed officials remained cautious in saying that this decision still depends on data; however, major brokerage firms have shifted their fundamental research towards the rate cut in September following Powell's warnings about the labor market. Pompliano's second topic is about the upward path. He argues that a straight line from a price level of about $69,000 in November last year to a six-figure price would risk "triggering a very large sell-off on the other side." Instead, the market "wants... a correction and a reset," reducing leverage and "laying the groundwork for the price." He outlines a wide consolidation range - "let's call it $125,000 to around $110,000" - before buyers come back. This sequence aligns with how many investment funds and cryptocurrency exchanges view September as a month of reduced risk due to weak liquidity, followed by a restructuring as the Q4 cash flow approaches. This also fits with Daan Crypto Trades' tactical perspective: "In my opinion, any major downturn in the next 1-2 weeks will be an opportunity for prices to recover/increase to new record highs for the year. Let's wait and see." All Eyes Are on the Fed Macroeconomic timing can be a decisive factor. The meeting of the Federal Open Market Committee (FOMC) on September 16-17 is currently a key point, with futures contracts indicating an 85-90% chance of an interest rate cut and some possibility of a second move by the end of the year. Chairman Powell signaled at Jackson Hole that labor market risks have increased even as inflation risks remain, a balance that has prompted many Wall Street policymakers to accelerate the pace of easing. At the same time, senior Fed officials emphasized that every meeting is "live" and depends on upcoming data - an important warning for risk assets that have already leaned toward a dovish outlook. If rate cuts become a reality, the question for BTC will be whether it confirms the current bid or merely meets expectations and fades away. The focus for this week will be the release of the Personal Consumption Expenditures (PCE) index on Friday - the Federal Reserve's preferred measure of inflation. The July PCE data will be released on August 29, providing policymakers and the market with important information about both core consumer price pressures and overall consumer prices. From there, attention will shift to the next important inflation data set, expected to be released just a few days before the (FOMC) meeting in September. On Thursday, September 11, the Bureau of Labor Statistics will release the Consumer Price Index (CPI) and the Producer Price Index (PPI) for August. These will be the final inflation checkpoints before the Fed meets on September 16-17, meaning they could influence the atmosphere of the meeting.