Bitcoin and crypto institutional product outflows underscore what is becoming a standard September for BTC price performance.
Bitcoin BTC $55,129 starts a new week fighting to preserve key support as markets prepare for a deluge of macroeconomic volatility triggers.
- BTC/USD holds $54,000 at the weekly close, giving traders modest confidence over how short-term BTC price action may shape up.
- CPI and PPI lead a key week of US macro data prints, these coming less than ten days before the Fed interest rates decision.
- Crypto funds shed $600 million over the past week, with spot Bitcoin ETFs also seeing steady net outflows.
- BTC price performance is looking “eerily similar” to 2019, according to a fractal which has remained valid throughout this year.
- Bulls are eyeing the odds of a 20% bounce as BTC/USD continues a sloping channel in place since March’s all-time high.
BTC price losses echo standard “Rektember”
Bitcoin managed to avoid a significant sell-off around the latest weekly close, setting it apart from the past few weeks.
Data from TradingView instead shows $55,000 as the level currently on bulls’ radar for a reclaim.
“If price can stay above $54.5k, I’m looking for a break above this green zone to see if Bitcoin can regain some upward momentum,” popular analyst Caleb Franzen commented in one of his latest posts on X alongside a chart.
Data from monitoring resource CoinGlass reveals a band of ask liquidity being added to the area around $55,500. In its own X post, CoinGlass itself said that it hoped for upward continuation.
“$52,500 must hold for continuation in the short term,” popular trader Crypto Tony meanwhile concluded about support levels.
“Interesting few weeks ahead.”
BTC/USD nonetheless remains down 7% in September, roughly in line with historical norms.
“Bitcoin is in a Halving year. So it makes most sense to compare 2024 with previous Halving years,” popular trader and analyst Rekt Capital argued while discussing the performance numbers.
“In the previous Halving years (2016 & 2020), Bitcoin enjoyed three straight months of upside across October, November and December.”
CPI precedes key Fed rate cut decision
A bumper week of US macroeconomic data precedes the all-important Federal Reserve interest rates decision on Sept. 18.
The coming days will see both the Consumer Price Index (CPI) and Producer Price Index (PPI) numbers for August, along with more unemployment figures.
Whereas the latter saw the bulk of risk-asset reactions last week, now, markets are looking for any last-minute surprises which could change bets on what the Fed will do next.
“This is the final week of inflation data before the long anticipated September Fed meeting,” trading resource The Kobeissi Letter wrote in part of its latest X posts on the topic.
Kobeissi noted that US stocks had suffered since the month began, making Bitcoin and altcoins no outliers in their lackluster performance.
“September 2024 has still not seem a single green day in the S&P 500, a great trading setup,” it added.
The latest estimates from CME Group’s FedWatch Tool show markets still favoring an interest rate cut on the more modest side of the scale — 25 basis points rather than 50. This could change, however, as the macro data rolls in.
Kobeissi, meanwhile, is among those arguing that the Fed is unlikely to surprise to the upside.
“As we have been saying for weeks now, both 50 bps rate cuts and emergency rate cuts are NOT needed,” it wrote last week after the unemployment data.
“While the labor market is cracking, the Fed needs to avoid moving too quickly again. The Fed has a bumpy road ahead.”
Crypto institutional investment sees a “red” week
The past week has not been kind to crypto institutional investment products as capital flees the sector.
In a particularly bearish market appraisal, Bank of America (BoA) revealed the worst slew of crypto fund outflows since the 2022 bear market.
At around $600 million last week alone, this, Kobeissi notes, thus represents the second-largest such outflow in the history of the industry.
“Over the last several weeks, crypto funds have regularly seen outflows unlike in Q1 when weekly inflows were as much as $3.3 billion,” part of an X post reported.
“Risk appetite in crypto seems to have disappeared despite expectations that the Fed will cut rates this month.”
The picture is similarly grim for the US spot Bitcoin exchange-traded funds (ETFs), which recorded net outflows every day last week.
Data from UK-based investment firm Farside Investors reveals that two out of the four trading days recorded net outflows above $200 million.
“Bitcoin is down~15% over the last two weeks and is trading ~25% below its all-time high,” Kobeissi concluded.
“Are crypto markets entering a bear market?”
Bitcoin 2019 comparison nears “critical juncture”
Current BTC price action is drawing increasing comparisons to distant 2019 — two block subsidy halvings ago.
Then, BTC/USD saw a long-term high around half way through the year before consolidating until Q4 2020. During that time, it witnessed the COVID-19 cross-market crash.
For Julien Bittel, head of macro research at Global Macro Investor, history is now repeating itself.
“This year’s Bitcoin price structure is starting to look eerily similar to 2019… Take a close look at the chart – it’s almost a perfect fractal of what we saw back then,” he told X followers at the weekend.
”Bitcoin has been stuck in a consolidation phase, and interestingly, just like in 2019, this consolidation has lasted exactly 175 days (so far). We’re now approaching that critical juncture where things could start moving in a big way.”
The fractal in question suggests that BTC/USD may be imminently due an “inflection point” and return to upside which should last.
“The next week will be incredibly important to watch,” he summarized.
crypto analyst and entrepreneur Michaël van de Poppe, who likewise sees a turnaround in Bitcoin’s fortunes potentially being right around the corner.
Popular trader Peter Brandt, meanwhile, has warned that BTC/USD is behaving too sluggishly since its most recent halving event in March.
Respecting the channel
More short-term hope for Bitcoin bulls comes courtesy of a simple regression channel this week.
As flagged by popular analyst Caleb Franzen, BTC/USD is currently challenging support at the lower boundary of a channel it has respected since mid-March and its $73,800 all-time highs.
The channel neatly summarizes the six months of consolidation seen since — and even the dip below $50,000 seen in early August was not enough to invalidate it.
“Bitcoin just had its 4th daily close below the regression channel,” Franzen confirmed on Sept. 7, identifying three other similar occasions.
While stressing that a rebound is not guaranteed simply by such a daily close, he noted that the three previous cases all resulted in BTC price upside of “at least” 20%.
Here, a repeat performance would see a trip to around $65,000 — itself capping a key technical area for Bitcoin, playing host to the aggregate cost basis for short-term holders.
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