BTC's Vicious Cycle

Uncharted Lite 11

“September: This is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, October, April, November, May, March, June, December, August and February.” - Mark Twain

• As the US Securities and Exchange Commission (SEC) elected to delay judgments on seven Spot ETF applications, BTC price has erased all gains earned this week. Price is down 4.4% to $26k, has seen over $20 billion in trading volume, while its market capitalisation is barely above $507 billion. The rally of earlier this week wasn’t enough to take us outside the bearish quadrant.

• Due to the ongoing delay in ETF approvals, short-term bullish gaming funds have exited. If investors rally behind it and purchase the dip, BTC will attempt another trend reversal from the now key support level of $26k. 

Figure 1

• The Federal Reserve in the US is likely done raising interest rates after a government report revealed that the unemployment rate rate climbed last month and pay growth slowed. The August unemployment rate was 3.8%, compared to 3.5% predicted and 3.5% last month. BTC was little altered, while traditional markets were mixed.

• We'll follow the continuous tango between inflation statistics, economic growth – August jobs data was released today — and Fed rhetoric. With ETF aspirations on hold for the foreseeable future, bitcoin bulls may look to a slowing economy and lower interest rates as a possible catalyst.

Figure 2