Benjamin Cowen, analyst and founder of Into The Cryptoverse, believes that Bitcoin could remain on a downward trend in September ahead of next year’s halving. The analyst pointed to Bitcoin’s performance and compared it to how it has performed over the years, predicting the end of the world’s most valuable cryptocurrency.
Bitcoin, currently trading at around $25,860, has been under pressure over the past few weeks, with the collapse of FTX and the bankruptcy of several centralized finance (CeFi) lending platforms such as BlockFi accelerating the decline after surging nearly 60% from its November 2022 lows. The token has retraced from its July 2023 peak, when it rebounded to around $31,800.
Will September be tough for BTC bulls?
After an impressive performance in July, bears gave up all of their gains in August. By the end of the month, Bitcoin was down about 20% from its July 203 high, with the August 17 drop triggering a full-blown panic.
In his analysis, Cowen noted that the coin fell 11.31% in August, slightly below the pre-halving average of the past two years, when the coin’s average returns for the month shrank by 11.71%. However, his predictions for BTC in September look even bleaker.
Citing data, the analyst said that prices tend to contract throughout September before halving. The average return for Bitcoin in September before halving was -17.29%. Therefore, if the same scenario holds true and Bitcoin follows the same trend, the coin could drop to $21,400 by the end of the month.
On the “bright” side, if one takes into account Bitcoin’s September performance during the past two halvings, the average return was -5.66%, which means that Bitcoin, while bearish, could drop to around $24,400 by the end of the month. This assessment means that if historical performance is ahead of the curve, Bitcoin could move further lower in the coming weeks.
Which way is Bitcoin going?
Bitcoin supporters are bullish in the medium to long term. Despite a sharp drop on August 17 that caused the coin to fall to a new low in the second half of 2023 at around $25,200, a small recovery in the second half of August and the first week of September may firm up the hopes of bulls. Judging from the price action, Bitcoin is not out of the woods yet.
Looking at the daily chart, BTC price is inside the bear candle of August 17, which is the main anchor bar that defines the current price action. In addition, while the price is relatively high, the trading volume is relatively low.
For a refreshing recovery, supporters are pinning their hopes on the U.S. Securities and Exchange Commission (SEC) approving a spot bitcoin exchange-traded fund (ETF). Such a derivative product would allow institutions to gain exposure, channel capital and potentially drive demand for bitcoin.
