Bitcoin (BTC +1.03%) is struggling to stay above the psychologically important $60,000 level, and it’s down 20% from its May 30 high. Also in late May, its biggest corporate holder, Strategy, made its first sale of the coin since 2022, and, in the same period, the macro backdrop has soured further, adding salt to the wound of a difficult crypto bear market.
Is there any relief in sight over the next few months, or is more pain on the way? Let’s look at the historical performance data to see what it reveals.
Image source: Getty Images.
The coming period tends to be good for holders
This June was worse than normal for this asset. Bitcoin’s median return for June is essentially flat at a loss of 0.5%. July, on the other hand, has typically been a strong one.
Since 2013, Bitcoin has closed nine of its 13 Julys green, with a median gain of 8.2%. The bear market years are most striking; July 2018 saw a pop of 21%, and July 2022 came with a gain of 17%.
In every prior instance in which the coin lost value for more than one month in a row in the lead-up, July’s return was strongly positive — though never enough to fully erase the prior losses. And that’s the most likely outcome this time around as well.
Today’s Change
(1.03%) $634.97
Current Price
$62566.00
Key Data Points
Market Cap
$1.3T
Day’s Range
$61734.00 – $62821.00
52wk Range
$57945.16 – $126079.89
Volume
21.4B
The bounce might be blunted this time around
It’s important to recognize that seasonal patterns like this one aren’t something to bet the farm on. Elements like the asset’s fundamentals, spot Bitcoin exchange traded fund (ETF) flows, and upcoming catalysts tend to exhibit a larger impact on price.
That said, holders may be a bit disappointed with Bitcoin’s performance in July, even if it regains some of what it has recently lost. There are two issues in particular.
On June 29, Strategy authorized a $1.2 billion “Bitcoin monetization program” to ease the market’s concerns about the ongoing viability of the digital asset treasury (DAT) company in light of Bitcoin’s decline. That program enables the business to sell its Bitcoin to fund its dividend and interest payments, build its cash reserves, and finance buybacks of its various classes of stock. This paves the way for the company that said it’d never sell its Bitcoin to sell a little bit more over time.
Today’s Change
(7.88%) $7.36
Current Price
$100.75
Key Data Points
Market Cap
$35B
Day’s Range
$97.60 – $104.10
52wk Range
$81.81 – $457.22
Volume
1.5M
Avg Vol
21.2M
Gross Margin
68.11%
The second factor is the new Federal Reserve chair, Kevin Warsh, whose first policy meeting on June 17 left interest rates on hold while leaving the door open to a rate hike before year-end. Tighter dollar liquidity is a headwind for risk assets like Bitcoin.
Aside from the above, any July rebound would only be a breather. August has averaged a slight decline since 2010 and September about a 4% loss, the only two months on the calendar with consistently negative averages.
So, don’t lose hope in Bitcoin’s long term, as its fundamentals are as intact as ever. But, don’t get your hopes up about the next few months; if you’re accumulating the coin, keep doing what you’re doing.
Source: Original Article
