Remember, remember, what the Delta variant could do to Bitcoin in September
Last Updated on 5 September 2021 by CryptoTips.eu
From a historical perspective there are two known sayings carrying September and remember. The first one has to do with the stock market and speaks of staying away in May and then to remember to come back in September. The second one speaks of gunpowder treason and plot and starts with: remember, remember…
Both carry warnings about things to come and that one should watch out. As September starts, those admonitions are being repeated when it comes to Bitcoin as well, as this month is historically a flat period for the world’s biggest cryptocoin. However, because of the surging Delta variant in the US, this could actually change in 2021. Let me explain.
QE extension
Stocks were expected to fall if the US economy would have added jobs at the pace of the last few months, because this continued (and expected) growth would mean that the Federal Reserve would soon stop QE tapering (quantative easing or buying up government bonds to support the economy and prop up stocks superficially).
However, as known German analyst Holger Zschäpitz remarked, the US economy added only:
235,000 jobs vs 733k expected, slowest gain in 7mths amid Delta surge. At least prior mth revised higher to 1053k from 943k. The unemployment rate falls to 5.2% as expected. Average hourly earnings were above expectations, rose 0.6% MoM vs +0.3% exp.
Good news, QE is not about to be terminated soon...
— PST (@PetrStanekk) September 3, 2021
The Delta variant is clearly slowing the US recovery at this point.
Now what does this all mean? Well, for one it is to be expected that QE, or quantative easing will now be continued and the Fed will continue to print money. In turn, this means companies will continue to buy stocks and other investments, one of them being Bitcoin.
And thus, the prediction made by Kraken analyst Pete Humiston of a few days ago could very well come true.
He stated:
September is historically Bitcoin’s worst-performing month. That said, it has been verging on $50,000 for the past three weeks or so now. Should Bitcoin stage a breakout above this psychologically significant milestone, it could renew investor interest and spark the momentum needed to carry it all the way back to $60,000.