August Blues: Historically Speaking, What Does This Month Hold for Bitcoin?

Key Insights

• Historically, August has been a bearish month for Bitcoin and the crypto market.

• Trading volume and market activity usually decline during the month

• Several analysts seem to believe so. However, there is still a possibility of a market shift and a Bitcoin rally starting by mid-August.

• Some analysts see a correlation between Bitcoin and Gold, and are expecting a breakout.

Historically speaking, Augusts haven’t been very bullish for Bitcoin and the broader crypto market.

According to data from Coinglass and other sources, there is usually a downturn in activity and asset value with Bitcoin during this period, and a recent report from Coinbase confirms this.

Coinbase believes that there is typically a noticeable crash in trading volume and market activity during this month.

Will we see a repeat of this?

An Incoming Dip for Bitcoin in August?

Coinbase analysts David Duong and David Han pointed out this disturbing trend in a recent report released earlier in the week.

Duong and Han believe that this phenomenon in August doesn’t “just happen”. Instead, it is a recurring phenomenon that has remained relevant for the last five years.

“Looking ahead, seasonality hasn’t typically worked in crypto’s favour for the month of August,” the analysts say.

“Bitcoin has averaged a decline of 2.8% during this month over the last five years, and August has often seen lower market activity in the past, as evidenced by a drop in BTC spot volumes by 19% in August vs. June 2023…”

According to the analysts, this trend doesn’t simply “occur” with Bitcoin alone but is more of a broader shift in investor participation during summer months.

Analysts Weigh In

There have been similar outlooks from all over Twitter since the month began.

Analysts like Jelle, for example, noted that Bitcoin closed in the green in July, with an increase of 2.95%.

However, the analyst has low hopes for August, considering how “the market tends to struggle in the remainder of Q3”. However, he also mentioned that October might turn out to be a positive month.

This outlook was echoed by Michael van de Poppe, who says that both August and September are prone to this trend.

However, there might be a shift in momentum starting mid-August. The analyst also expects a new all-time high for Bitcoin between September and October.

To avoid further decline, the analyst also mentions that Bitcoin will need to hold above the $60,000 and $61,000 price levels to maintain its trend towards said ATH.

On the other hand, Andrew Kamsky sees a correlation between Bitcoin and Gold.

The analyst says that both of these assets are following what he calls a “multi-year Cup and Handle pattern.”

Furthermore, since Gold has broken out, Bitcoin appears ready to follow suit, likely by the end of August or early September.

Finally, we have others like Crypto Rover, who believe that August isn’t “always” a bearish month for Bitcoin.

The analyst says that on the off chance that we do see a Bitcoin rally, Augusts are “an extremely bullish month”.

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