‘Crypto winter is close to being over’

<a href="https://xpertsstudio.com/bitcoin-rebounds-from-76k-but-crucial-resistance-remains-above-80k/” title=”Bitcoin Rebounds From $76K but Crucial Resistance Remains Above $80K”>Bitcoin tops $80,000: ‘Crypto winter is close to being over’

• BTC-USD

Investors got a hopeful signal on Thursday that bitcoin (BTC-USD) may defy its historically weak September trend.

The world’s largest cryptocurrency jumped 4% on Thursday to rise above $80,000 as worries about a Federal Reserve rate hike eased and Treasury yields dropped.

The question is whether the token can remain above these levels, given that bitcoin has historically posted negative returns in September in nine of the past 15 years.

“It’s important data, and we should respect it,” Fundstrat head of digital assets Sean Farrell said. However, the strategist noted that the token has “bucked” this historical monthly trend over the past few years.

“We haven’t seen a negative September in four years, and seasonality — it’s a helpful data point, but it is not a foolproof system for trading these markets,” he said.

The token is coming off a strong August rally, prompting some strategists to suggest that the crypto bear market may have bottomed out or is nearing one.

“The recent BTC price movement suggests that the crypto winter is close to being over,” Noelle Acheson, author of “Crypto Is Macro Now,” told Yahoo Finance.

The token rallied 25% last month as the Treasury Department’s recent intervention in the bond market and assistance to Japan helped lift the prices of gold and crypto assets.

Some of those gains were given back as oil prices surged and hawkish comments from Fed Chairman Kevin Warsh raised concerns about the Fed’s upcoming September rate decision.

On Thursday, Fed governor Christopher Waller hinted he would support keeping rates unchanged if inflation eases.

“I could see crypto and broader equities mounting a rally post-FOMC that could take bitcoin to a higher level than today into late September, early October, ” David Grider, head of liquid investments at Finality Capital, told Yahoo Finance.

Grider said the move would be driven by either a surprise Fed rate hold or by yields falling sharply after the first rate hike.

The risk of a market correction still holds, in which case bitcoin would also be sold off. But crypto analysts see such a move as short-term.

“So long as the Treasury is willing to intervene in the yield curve, we believe, the bid on ‘hard assets’ such as bitcoin stays,” Bernstein analyst Gautam Chhugani wrote in a recent note.

Chhugani and his team called a bottom for bitcoin earlier this year and have placed a $150,000 year-end price target on the token.

With the exception of 2018 and last year, the fourth quarter has proven bullish for bitcoin.

Source: finance.yahoo.com