Bitcoin Expects Positive Seasonality in Q4

CryptoQuant analysts believe that Bitcoin is entering a positive seasonal period, but increased demand is necessary for the BTC price to reach $100,000 in the fourth quarter, Cointelegraph reports. Historically, Bitcoin has done well in the month of October in bullish cycles, especially in halving years like 2024. The market intelligence firm noted that in previous halving years - 2012, 2016, and 2020 - bitcoin's price rose 9 percent, 59 percent, and 171 percent, respectively. The analysts emphasized that as of September, Bitcoin's performance in 2024 is similar to that of 2016 and 2020.

CryptoQuant's Bull/Bear Market Cycle Indicator shows that Bitcoin remained in a bullish phase between March and August. However, the price has been in a bear phase from August through September and is now in the final quarter between the bull and bear phases. In comparison, Bitcoin entered a clear bull phase in the fourth quarter of 2020, which makes for a relatively weak performance going into the final quarter of the year. The report also emphasized that the apparent demand for bitcoin has stopped falling, but needs to grow faster to sustain a higher price in the fourth quarter.

The data shows that apparent demand growth for bitcoin has stagnated since July, fluctuating between -23,000 and +69,000 BTC per month. By comparison, apparent demand for Bitcoin grew by 496,000 BTC in April, when the price was around $70,000. Analysts believe that institutional demand via U.S. bitcoin exchange-traded funds (ETFs) has been crucial to the further rise in BTC prices. These investment products shifted from net selling of 5,000 BTC to net buying of 7,000 BTC between Sept. 2 and Sept. 30, and could drive prices higher in the final quarter of 2024 if ETF demand continues to accelerate.

Spot bitcoin ETFs saw net inflows of $1.8 billion between September 13 and September 30, according to SoSoValue, suggesting increased institutional demand for these investment products in anticipation of higher BTC prices in the fourth quarter. London-based asset manager CoinShares noted that the approval of options for certain U.S. investment products may have boosted market sentiment, leading to inflows of more than $1 billion into bitcoin investment products between Sept. 23 and Sept. 27. CryptoQuant said that if demand continues to grow, the price of bitcoin could reach between $85,000 and $100,000 by the end of December. CryptoQuant says that if demand continues to grow, the price of bitcoin could reach between $85,000 and $100,000 by the end of December. Market participants are currently focused on growing geopolitical tensions in the Middle East, the health of the U.S. job market, and future rate cuts in 2024 after the Federal Reserve cut rates by a whopping 50 basis points on September 18th.