Key Bitcoin Risk Factors to Watch in September| Matrixport Research

As Bitcoin enters its most challenging month, September — historically marked by negative returns — it faces additional pressure this year. Not only is Bitcoin contending with seasonal challenges, but it will also be impacted by critical factors such as the outlook for the U.S. tech sector following NVIDIA’s earnings projection, the Federal Reserve’s policy decisions, and the upcoming U.S. Presidential candidate debate between Kamala Harris and Donald Trump.

This September holds particular significance for Bitcoin’s trajectory.

The correlation between NVIDIA and Bitcoin was strong from late 2022 through the second quarter of 2024. However, Bitcoin has recently lagged behind the AI (artificial intelligence) rally reflected in NVIDIA’s outperformance. Both assets are now making lower highs, indicating the possibility of a deeper correction.

The market is poised to react to the U.S. employment data on September 6. In late 2022, Matrix on Target adopted a bullish stance, anticipating that U.S. inflation would drop from 8% to 3%, even as most economists predicted a recession in 2023. However, the Federal Reserve’s focus now seems solely on controlling inflation. Fed Chair Powell highlighted this shift during his Jackson Hole speech, emphasizing the labor market as a primary concern.

During the 2018/2019 rate-hiking cycle, Bitcoin struggled but rallied strongly once the Fed paused. However, when interest rates were eventually cut, Bitcoin experienced a brief rally followed by a gradual decline, which was only momentarily interrupted by further rate cuts.

Disclaimer: The above content is for informational purposes and reference only. The content does not constitute investment advice. Digital asset transactions can be precarious and volatile. Investment decisions should be made after carefully considering individual circumstances and consulting financial professionals. Matrixport is not responsible for any investment decisions based on the information provided in this content.

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