Bitcoin at an Inflection Point…Are 'September Effect' Warning Lights Turning On?

Slumped to the $107,000 Range

ETFs Also Saw $750 Million in Net Outflows Last Month

Experts: "A Crucial Turning Point This Week"

Bitcoin (BTC) prices have slumped to the $107,000 range for the first time in two months. Despite expectations of rate cuts, there are views that Bitcoin may find it difficult to avoid the "September Effect."

According to cryptocurrency market tracking site CoinMarketCap, Bitcoin at one point traded in the upper $107,000s, down about 0.8% from the previous day. It is the first time Bitcoin has recorded the $107,000 range since early July, two months ago.

After hitting a record high in mid-last month, Bitcoin entered a correction phase. Over the past two weeks, the price shrank by more than 25% from the $123,000 range to the $107,000 range. Last month, U.S. spot Bitcoin exchange-traded funds (ETFs) also saw net outflows of $750 million (about 1 trillion won). It was the first monthly net outflow in five months since March (-$770 million).

The outlook for this month is not bright either. In particular, September is considered a period when crypto assets notably tend to decline. According to CoinGlass, Bitcoin's average September return over roughly ten years from 2013 through last year was -3.77%.

U.S. crypto outlet Cointelegraph said, "In September, investors tend to take profits after the summer rally or rebalance portfolios ahead of the fourth quarter," adding, "Bitcoin, which often moves in tandem with risky assets, can also become a victim of seasonal factors."

Given this situation, investor sentiment has also contracted. According to CoinMarketCap, as of the day the crypto Fear & Greed Index fell one point from the previous day to 39, entering the 'Fear' stage. On Polymarket, the world's largest betting site, the probability that Bitcoin would recover the $110,000 level this week was 34% on the day, down 13% points in one day.

Experts say Bitcoin is at an inflection point. A short-term variable is the U.S. August employment report (to be released on the 5th), which will serve as a rudder for future monetary policy discussions. Crypto analytics firm Matrixport said, "Bitcoin is at an important technical level ahead of the U.S. employment data release this week," adding, "a situation in which large (price) fluctuations can occur." A Yonsei Dent CryptoQuant contributor wrote, "(this zone is) a very important turning point," and analyzed, "If the $107,000 level breaks, short-term investors' selling could intensify."

Movements by large investors are mixed. According to on-chain analytics firm LookonChain, one long-term Bitcoin investor sold $323 million (about 450 billion won) worth of Bitcoin in a single day. In contrast, Japanese listed company MetaPlanet, which has adopted a Bitcoin treasury strategy, additionally purchased $112 million (about 160 billion won) worth of Bitcoin that day. Crypto analytics firm 10x Research said, "(Bitcoin) volatility has begun to surge," and "the next two weeks will determine whether the bull market continues."