Analysts from cryptocurrency hedge fund QCP Capital pointed out that looking back at the market trend in August, Ethereum (ETH) performed significantly worse than Bitcoin (BTC), and warned that as the time series enters September, once "seasonal weakness" reappears, The overall cryptocurrency market may face further downside risks.
Analysts at QCP Capital said: "Bitcoin fell 8.6% at the close of August. Affected by the global stock market crash triggered by the Japanese stock market disaster at the beginning of the month, Bitcoin was unable to rise back above $65,000. The performance of Ethereum was even weaker. It fell 22.2% in August, which was said to be mainly due to heavy selling by Jump Trading.”
The Bank of Japan unexpectedly announced an interest rate hike at the end of July. After the Japanese yen carry trade bubble burst, it triggered a magnificent deleveraging wave of risk assets. Mainstream cryptocurrencies plummeted along with global stock markets.
According to QCP Capital, Ethereum has already lagged behind Bitcoin after this deleveraging event, and the ensuing Jump Crypto selling pressure further exacerbated the decline.
Additionally, Ethereum spot ETFs also underperformed expectations in August, indicating waning interest in these products. Ethereum-related investment products saw net outflows of $5.7 million last week, with trading volume at just 15% of what it was when it was first launched in late July.
Historical trends show: the cryptocurrency market remains bearish in September
QCP Capital further noted that September this year may see further losses for major cryptocurrencies. Analyst said:
Historical data shows that September is usually a bearish month for Bitcoin. In the past seven years, September has recorded declines in six years, with an average decline of 4.5%. If this September’s performance follows this pattern, Bitcoin could fall to around $55,000.
Analysts expect Bitcoin could find support in September around $54,000, a price level it reached when it rallied in July before briefly touching $70,000 at the end of the month.
Separately, short-term option implied volatility shows that traders in the derivatives market expect a muted performance from Bitcoin and Ethereum in the coming weeks, but longer-term bullish sentiment has increased. Analysts noted:
We expect the volatility curve to steepen further as short-term volatility gradually declines in sideways markets. At the same time, more forward calls on Bitcoin and Ethereum have been extended to March next year.
〈QCP Capital Analyst: Bitcoin may further drop to US$54,000 in September〉 This article was first published on "Blocker".
