Bloomberg reported that in September this year, Bitcoin broke the trend of previous years and set a record for the best performance in the month in recent times. A series of interest rate cuts around the world, especially from the U.S. Federal Reserve, allowed the largest cryptocurrency to break its quarterly curse and pave the way for a strong rally.
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ToggleBitcoin’s 10% gain in September reverses historical trend
Different from previous years, Bitcoin has increased by more than 10% this month. According to Bloomberg data, over the past ten years, Bitcoin has fallen an average of 5.9% in September, which has always been a bearish month. Not only Bitcoin, but other smaller altcoins have even risen by more than 20%, showing that looser financial conditions are encouraging investors to take higher risks in the cryptocurrency market.
U.S. central bank policy boosts market sentiment
The main driving force behind Bitcoin's strong rise in September was global monetary policy. In order to promote economic growth, the US Federal Reserve, the European Central Bank (ECB) and the People's Bank of China all implemented interest rate cuts in September. These loose monetary policies have caused investors to turn to various assets including stocks and gold in anticipation of continued stimulus measures in the future.
The trading director of Arbelos Markets believes that Bitcoin has the highest correlation with monetary policy, especially the Federal Reserve. The easing policies of other central banks have also contributed to Bitcoin’s rise.
Bitcoin Price Likely Trends
The price of Bitcoin exceeded US$65K today (9/27). In 2024, Bitcoin has achieved a 56% increase, which mainly benefited from the inflow of funds from the US Bitcoin ETF. However, Bitcoin remains below its all-time high of $73,798 set in March this year. That $65,000 price tag may be a sticking point, though. Caroline Mauron, co-founder of Orbit Markets, which provides liquidity for digital asset derivatives trading, said that due to the expiration of a large number of option contracts, this price level may become "sticky" and the fluctuations may last for several hours. If it cannot clearly break through $65,000, Possibly signaling a downward trend, a recent report from cryptocurrency exchange Kraken shares the same view.
In addition to the impact of monetary policy, the digital asset market is also paying close attention to U.S. political trends. The ongoing U.S. presidential election has an important impact on the encryption industry. Many industry insiders expect that after the election, the U.S. regulatory policy on digital assets will be clearer and have a far-reaching impact.
