In the Bitcoin and the overall crypto market, August has long been observed as a quieter month, with historical data showing a consistent downturn in both activity and asset value during this time of the year. Coinbase’s analysis further highlights this pattern in its latest weekly report. According to Coinbase analysts David Duong and David Han, there is a noticeable reduction in trading volumes and a decrease in the market’s dynamism that characterizes the month.
An Impending Major Dip For Bitcoin In August?
The analysts point out that this seasonal trend can’t be seen as a mere coincidence as it is a recurrent phenomenon. In the “Coinbase Weekly” report, they cited that Bitcoin spot volumes in August 2023 fell by 19% compared to June of the same year.
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Similarly, Bitcoin futures volumes dipped by 30% across global centralized exchanges during the same timeframe. This decreased activity is significant enough to influence market behavior, potentially leading to increased volatility due to thinner liquidity. The Coinbase’s report further details that on average, Bitcoin has shown a decline of 2.8% in August over the last five years.
According to the analysts, this trend is not isolated to Bitcoin; it reflects a broader market behaviour that could be attributed to various factors, including seasonal investment shifts and lower participation rates during the summer months in many regions. They further predicted that this August may not stray from the established pattern, expecting a continuation of subdued market performance.
Outlook From Analysts In The Community
Echoing the sentiment from Coinbase, other prominent figures in the crypto space have shared their observations. Analyst Jelle pointed out on Elon Musk’s social platform X that despite a positive close in July, the historical struggle of the market in Q3 is quite noteworthy, with recovery often not beginning until October.
Similarly, analyst Micheal Van De Poppe suggested that while August and September typically record poorer performance, there might be a shift in momentum starting mid-August, potentially setting the stage for new all-time highs in the following months.
Van De Poppe also disclosed that to see Bitcoin’s continuation towards its all-time high (ATH), price would need to hold above $60,000 to 61,000 region.
Meanwhile, at the time of writing, Bitcoin has seen a slight uptick increasing by 0.7% while still trading above $63,000. Commenting on BTC’s current price action, Jelle noted:
Bitcoin is still trading inside the channel we’ve spent the past months inside of, but holding above key supports. Looks like a breakout is getting closer by the day. Patience, until then.
Featured image created with DALL-E, Chart from TradingView