Bitcoin may find $54K support during bearish September: QCP

Following Bitcoin’s red spell in August, analysts at QCP Capital are predicting a bearish September for the cryptocurrency, but a pivot from the Federal Reserve could provide relief.

Bitcoin’s (BTC) historical trend appears likely to repeat itself, with the cryptocurrency set to drop another 5% this month following the August crash, according to a digital asset trading desk.

Bitcoin has traded in the red for six of the last seven Septembers, losing an average of 4.5% over those years. QCP Capital said that this decline could be in BTC’s favor and could support a potential bullish move.

The firm expects BTC to strengthen around $54,000, the same level Bitcoin bounced to in July before hitting $70,000. At press time, the cryptocurrency was changing hands at $58,000 and up about 2% in a modest overall market climb.

24-hour BTC price chart – September 2 | Source: crypto.news Experts: Fed rate cuts could invalidate historic Bitcoin trend

This month has generally represented a bearish trend for BTC, but the expected monetary policy change from the US Federal Reserve could trigger a rally, Li.Fi CEO Philipp Zentner told crypto.news via email on Sept. 2.

Fed Chairman Jerome Powell said last month in his Jackson Hole speech that it was time to make a change in interest rates. Investors expect a 25 to 50 basis point cut in late September.

Zentner pointed to increasing BTC dominance, decreasing cryptocurrency exchange balances, and the supply of BTC miners on the open market as bullish indicators.

In fact, BTC’s dominance has increased to 58% as investors back the leading cryptocurrency over altcoins like Ethereum (ETH), which have underperformed compared to Bitcoin.

CoinGlass data showed that billions of BTC have left crypto exchanges like Binance and Coinbase in the past 30 days. In June, BTC and ETH exchange balances fell to a four-year low. This trend may indicate a bullish investor outlook, although sentiment remains mixed ahead of expected rate cuts.

Overall, the market is poised for a potentially significant rally driven by a combination of strong Bitcoin fundamentals, a well-capitalized stablecoin market, and the expectation of a more favorable monetary policy environment. The combination of these factors positions Bitcoin and the broader market for a bullish phase as the year progresses.

Philipp Zentner, Li.Fi CEO