Why Is September Always Harsh on Bitcoin?

Historical data shows that September tends to bring losses to the crypto market. On average, Bitcoin investors see around 6% declines during this month. While many expected 2025 to defy the trend, the promising early gains quickly vanished.

It’s not just retail investors exiting the market. Bitcoin spot ETFs saw four consecutive days of outflows, amounting to $1.13 billion pulled out, while Ethereum ETFs recorded another $795.8 million in withdrawals during the same period.

Still, history suggests that periods of panic can also present buying opportunities for larger players.

Bearish Setup or Imminent Breakout?

From a technical perspective, Bitcoin is showing short-term weakness. The price fell below the 200-day moving average ($112,400), leaving $104,000 as the next critical support level. Meanwhile, the Relative Strength Index (RSI) is sitting at 38, indicating fading momentum.

Currently, Bitcoin is consolidating within the $108K–$115K range, hinting at an upcoming breakout. At the same time, the Fear & Greed Index dropped to 33, placing the market firmly in the “fear” zone. Ironically, such fear-driven environments often mark the beginning of significant rallies.

Q4: Bitcoin’s Historically Strong Season

Looking at past performance, Q4 has been Bitcoin’s strongest period. Since 2013, the cryptocurrency has delivered an average 85% return during the last quarter of the year. November alone has averaged 46% gains, while October has brought around 21% increases.

This year may follow a similar trajectory. Analysts point to potential Federal Reserve rate cuts, a weaker U.S. dollar, and a shift toward risk assets as major catalysts. On top of that, a striking supply-demand imbalance could fuel Bitcoin’s growth: only $77 billion worth of new BTC is issued annually, compared to an estimated $3 trillion in institutional demand.

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Friday’s economic and geopolitical developments significantly increased selling pressure not just in crypto, but across traditional markets as well. U.S. stock indices also dropped sharply: the Dow fell 1.23%, the S&P 500 lost 1.6%, and the Nasdaq declined by 2.24%.

1. Weak Employment Data

The U.S. Bureau of Labor Statistics reported that only 73,000 jobs were added in July — well below expectations. Moreover, there was a downward revision of 258,000 jobs for May and June combined, indicating deeper labor market weakness than previously thought.

While the unemployment rate remained at 4.2%, the number of long-term unemployed rose by 179,000, reaching 1.8 million. The increase in the number of new job seekers also stood out. Markets interpreted this as a sign that the labor market deterioration is accelerating.

2. Strong Response from President Trump

President Donald Trump reacted swiftly to the labor data. In a public statement, he accused BLS Commissioner Erika McEntarfer of manipulating employment figures and ordered her immediate dismissal. This move strengthened perceptions that economic data is being politicized, shaking investor confidence.

3. Escalating Tensions with Russia

Later the same day, Trump announced that he had ordered two nuclear submarines to reposition in response to provocative statements from Russian officials. The lack of a prior statement from the Pentagon added to the unease. Investors interpreted this as a significant geopolitical risk, further pressuring risk assets.

Rate Cut Expectations Rise — But Confidence Doesn’t

Following the weak jobs data, many investors now expect the Federal Reserve to cut rates by 50 basis points in September. However, this anticipation did little to lift the markets.

That’s because rate cuts are no longer viewed as a proactive tool to stimulate growth. Instead, they are increasingly seen as a reaction to economic weakness — a signal that the downturn may already be underway. In this context, easing monetary policy failed to counter the growing fear of recession, especially in sectors like crypto that are highly sensitive to macro sentiment.

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The post Crypto Market Sell-Off: 3 Reasons Behind Investors’ Risk-Off Mood appeared first on Coin Engineer.

Fed’s Interest Rate Cuts Outlook and Economic Conditions

• The current Fed funds rate stands at 4.33%.

• Investors are expecting two rate cuts by the end of 2025.

• The probability of a 25 basis point cut in September has climbed to 75%.

• Fed official Bowman noted that gradual policy adjustments would continue in order to support the labor market.

At its latest meeting, the Federal Reserve kept its policy rate steady within the 4.25% to 4.50% range. Unlike previous meetings, however, the decision was not unanimous. Two of the 12 FOMC members voted in favor of a 0.25% rate cut. This split decision, along with the tone of the official statement, is being interpreted as a strong signal that a rate cut may come as early as September.

FOMC Projections and Market Expectations

The FOMC’s June projections had already indicated the possibility of two rate cuts before the end of 2025. However, with only three meetings left on the calendar, futures markets have not fully reflected this scenario yet, pricing in only about a 40% chance. On the other hand, some analysts suggest the likelihood is closer to 66%, signaling a solid—but not guaranteed—possibility.

Powell’s Hawkish Messaging

One of the factors reducing expectations of a September rate cut is Fed Chair Jerome Powell’s hawkish tone during his press conference. Powell emphasized that no decision has yet been made for the September meeting. Still, his strong focus on ongoing inflation risks, while downplaying downside risks to growth and the labor market, created a more cautious market sentiment.

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The post Two Rate Cuts Fully Priced In by End of 2025! Fed Becoming More Clear? appeared first on Coin Engineer.