September’s downturn; examining the ongoing influence of the month on the cryptocurrency cycle

Bitcoin’s challenging month is nearly upon us, and as we near another September, is it unavoidable that prices will decline? Let’s examine some of the factors that have historically made the ninth month of the year unfavorable for Bitcoin.

Reasons September is historically Bitcoin’s challenging month

Since 2013, September has consistently been a tough month for Bitcoin, with losses recorded in eight of the last 11 years. This trend may be attributed to retail investors often taking profits after summer surges or liquidating crypto assets to manage their autumn expenses, such as tuition and tax preparations.

Bitcoin’s difficult month might also be seen as a self-fulfilling prophecy, as traders anticipate negative price movements and adopt a more cautious approach, further driving the market down. Context is crucial here, as most September declines have been relatively modest.

This month usually signifies a local bottom, after which Bitcoin frequently experiences a strong rebound into ‘Uptober,’ as the fourth quarter has historically been associated with recovery and even significant rallies. For instance, in October 2020, Bitcoin rose from approximately $10,800 at the beginning of the month to over $13,800 by month’s end, representing an increase of more than 27%.

August summary: record highs and whale activity

August 2025 was remarkable by any standard. Bitcoin reached an all-time high of $124,533 on August 14, only to drop 11% to lows around $110,000 just two weeks later.

Nearly $200 billion in market capitalization vanished, triggered by a single event: a previously inactive whale that sold approximately 24,000 BTC, causing the spot price to fall below $109,000 and initiating the largest liquidation cascade of the year.

Close to $900 million in derivative positions were eliminated, with 90% being bullish longs, resulting in $150 million in BTC and $320 million in ETH liquidated. Ethereum demonstrated relative resilience, staying above its 100-day moving average despite an 8% drop.

The recent downturn was not solely due to technical factors or market sentiment. The order books for both spot and derivatives markets remained thin, meaning any significant sell-off (such as the whale’s actions) was sufficient to heighten price volatility.

Additionally, on-chain data from late August indicated weak activity and diminished inflows, further undermining bid support.

Macroeconomic uncertainty continues to pose challenges. With the U.S. Federal Reserve’s September policy decisions in the spotlight, traders are factoring in both the risk of erratic movements and the possibility of renewed optimism if macroeconomic indicators, such as a rate cut, become favorable.

Anticipating September: scenarios and indicators

Crypto trader Cas Abbé presented three potential scenarios for Bitcoin as September approaches. In his primary “Range & Repair” scenario (40% likelihood), Bitcoin is anticipated to trade sideways between $110K and $120K for the majority of the month, as excess leverage is diminished and institutional investors gradually begin to accumulate. This consolidation would establish a healthier foundation for a possible Q4 rally.

In the “Second Flush” scenario (35% likelihood), if Bitcoin falls below $110K, a subsequent wave of liquidations could occur, pushing the price into the high $100Ks and eliminating remaining leveraged positions. Historically, such corrections often precede a robust bottom.

On the other hand, the “Quick Reclaim” scenario (25% likelihood) envisions institutions purchasing aggressively, allowing BTC to swiftly regain the $117K–$118K range and prompting an earlier resurgence of bullish sentiment.

Throughout September, Abbé advises traders to closely observe various on-chain and macro indicators; particularly, options market activity leading up to the September 27 expiry could provide valuable insights into positioning and sentiment.

Whether Bitcoin’s challenging month will turn favorable this year remains uncertain, but with thin liquidity, increased volatility, and institutional buyers poised to act, September may present both risks and opportunities this year.

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