September continues to be a losing month for Bitcoin. With prices nearing records, volatility in the market is heightened amid macroeconomic tensions.
Tariffs Under Pressure
The situation with reinstated trade tariffs from August remains unresolved. Their impact is expected to be reflected in inflation data this month, which may prompt traders to reposition their holdings. Vetle Lunde of K33 Research has already scaled back his Bitcoin exposure, noting that unexpected price swings similar to earlier this year cannot be ruled out.
Derivatives Market Looks Overheated
With open interest in perpetual futures reaching yearly highs, a leveraged environment is building. Funding rates are showing no clear direction, which makes Bitcoin vulnerable to sharp movements. Should investor sentiment turn negative, support levels may come under pressure.
Prospects and Economic Policy Impact
Despite the current risks, Lunde's outlook on Bitcoin's long-term prospects remains positive. Expectations for Federal Reserve rate cuts and increased fiscal spending are favorable for the cryptocurrency. Investors are advised to practice patience while awaiting clearer tariff impacts on the economy.
Bitcoin remains a focal point, trading just above $111,000. Given the current market influences, it is crucial to closely monitor economic developments that may dictate the cryptocurrency’s future movements.
