- Kraken said Bitcoin would produce a negative performance for September
- Historically, September is the worst-performing month of Bitcoin
- More volatility and gains to come in the coming months
Bitcoin News Today – A few weeks ago, Kraken predicted that Bitcoin (BTC) would produce a negative performance for September before returning to “aggressive volatility.” Kraken is a digital currency trading platform based in the US. In its August 2020 volatility report, Kraken predicted that the benchmark digital currency would see negative returns in September.
September Is the Worst Performing Month of Bitcoin
According to the report, historically, September is the worst-performing month for Bitcoin, with an average return of -7 percent. It appears that as the digital currency has underperformed its average returns for most months this year, chances are the performance this month would be worse. Nevertheless, regardless of the bearish outlook for the near term, the report pointed out some gleams of hope.
Bitcoin (BTC) Price Today – BTC / USD
The report also identified a record share of Bitcoin’s supply that has not moved in more than a year, with the exchange saying that “historically, this dynamic has foreshadowed a new bull market.” According to the report, chances are Bitcoin would see aggressive fluctuations as the markets move further away from the local low in July or “suppressed pocket” for volatility. A snippet of the report states:
Twelve times in the past, Bitcoin’s annualized volatility bottomed between 15% and 30% before climbing, on average, to 140% and returning +196% over 94 days. As of the end of August, 38 days have passed since the volatility low of 23% set on July 24, with volatility rising to 44% and price gaining +25%.
Bitcoin May See More Volatility and Gains in the Coming Months
The report explains that history shows that there may be sufficient room for higher volatility and gains in the coming months. The exchange also noted that Sept. has produced the weakest volatility on average, according to history. This suggests that Bitcoin may not see accelerated volatility until at least the 4th quarter of this year.
Nevertheless, the prediction of Kraken is not necessarily a reliable guide for future events, with the trading platform recently predicting that a Bitcoin rally of 50 to 200 percent was imminent on August 10. The prediction came when the digital currency was trading between $11,500 and $12k, and it only surged by $500 from the local top.
Kraken also pointed out in the report that August saw the correlation between Bitcoin and gold push into a new all-time high of 0.97 before it plunged back to 0.25. Similarly, the benchmark digital currency also had a high correlation with the S&P 500 for the better part of August. However, the correlation crashed to -0.2 after posting a local top of 0.84.