Market update
August was not a great month for prices, with Bitcoin falling 8.7% and ETH and SOL losing more than 20% each. Unfortunately, history suggests September is usually hit with an average loss of 6%. That said, US interest rate cuts are finally expected to be cut later this month, and Rekt Capital says in previous halvings, Bitcoin broke out about 150-160 days afterwards, which would be late September. He also notes that average October returns are 22.9%. As far as this week’s price action goes, Bitcoin is currently down 6% from seven days ago to trade at around A$87,342 (US$59,611), while Ethereum is down 5% to trade at around A$3,750 (US$2,559). Solana collapsed 14% as the memecoin degens decamped, XRP lost 4%, Cardano lost 9%, despite (or perhaps because of) its Chang hard fork, and Dogecoin was down 12.1%. Understandably, sentiment has dropped to low levels, with the Crypto Fear and Greed Index at 26, or Fear.
Bitcoin surged by almost 5% in a few hours on Saturday after the Federal Reserve’s Jerome Powell said “the time has come for policy to adjust.” US interest rates are now widely expected to fall in mid-September which is good news for risk assets. RFK Jr also dropped out of the race for the White House that day, potentially increasing the chances of a pro-crypto Donald Trump victory. Bitcoin is now back above the Short-Term Holder Realised Price, which is “bullish” news, according to analyst Philip Swift. It finishes the week up 3% to trade around A$93,005 (US$63,363). Ethereum also gained 1% over the past seven days to trade around A$3,972 (US$2,677). Solana was up 8% despite the memecoin craze cooling and daily transaction fees falling to levels last seen in May. XRP lost 3%, Dogecoin gained 1%, and Cardano surged by 7%. The Crypto Fear and Greed Index is at 55, or Greed.
In a week that marks 53 years since President Richard Nixon took the US off the gold standard, leaving the US dollar essentially unbacked, Bitcoin traded as high as A$92.6K (US$61.7K) and as low as A$86K (US$56.8K)… but finishes the week pretty much where it began at A$89,774 (US$60,752). Ethereum lost 2.8% over the same period and is currently trading around A$3,945 (US$2,642). The memecoin craze may finally be waning, with Coinshares attributing a record A$57.9M (US$39M) outflow from Solana funds last week to a “sharp decline in trading volumes of meme coins, on which it [Solana] heavily relies.” Solana and Cardano were flat, XRP gained 5.5% and Dogecoin fell by 5.5%. The Crypto Fear and Greed Index is at 30, or Fear, which is a marginal improvement on last week’s 25 or Extreme Fear.
Congratulations — you survived the bear market of August 5 to 8. This time last week, things were looking grim, with Bitcoin plunging to $A77K (US$49.8K) as traditional markets tanked. But Bitcoin went on to jump 12% on Thursday, which was the biggest single-day rise since February 2022. The Bank of Japan soothed fears of any further interest rate rises, and Bitcoin whales bought the dip, according to Santiment. Despite a “death cross” appearing on the charts (often not that deadly), Bitcoin has recovered almost all of the ground it lost in the crash and finishes the week up 5% from last Tuesday. Ethereum was hit harder, and while it finished the week at 7%, it remained 8% below its pre-crash price. Solana gained 3%, XRP (10%), Dogecoin (7%) and Cardano (2%). With Iran still indicating it will launch an attack on Israel and US inflation and retail sales data out this week, there are still plenty of risks. LMAX Group market strategist Joel Kruger told Blockworks: “Technically speaking, there has been nothing in recent price action to suggest anything more than choppy trade.” With August and September typically poor months for crypto market returns, analysts appear to be coalescing on October as the most likely time for price appreciation. The Crypto Fear and Greed Index is at 25, or Extreme Fear.
Stocks and crypto markets took a dramatic dive on Monday. While there are growing fears of a recession in the US as unemployment rises—and even talk of emergency rate cuts—the main catalyst appears to be the worst one-day plunge on Japan’s Nikkei index since Black Monday in 1987, amid the violent unwinding of the Japanese Yen carry trade.
