Bitcoin (BTC) recorded its strongest August performance since 2017, rising about 25 per cent to end the month near $80,000.
As of September 4, BTC was trading at $80,681, representing another 3.7 per cent increase over the previous 24 hours, according to market data.
The Bitcoin rally began in early August after weaker-than-expected US jobs data pushed the cryptocurrency to a monthly high of $65,300 on August 7. The figures reduced expectations of a Federal Reserve rate hike in September and supported a broader risk-on move across markets.
By late August, Bitcoin moved sharply higher. Analysts linked the rise to improving liquidity expectations, US Treasury bond buybacks and stronger institutional demand connected to ETF flows.
A major factor was a short squeeze that reportedly liquidated about $1.4 billion in bearish leveraged positions. Analysts at 21Shares said the rally appeared more driven by spot buying than leverage, suggesting that the demand behind the move could prove more sustainable.
Progress around Washington’s emerging crypto regulatory framework also supported market sentiment. Reports of movement on ETF approvals and greater policy clarity added to the positive outlook.
Falling bond yields and changing macroeconomic conditions provided further support. Increased long-end US Treasury bond buyback activity improved liquidity expectations, while institutional investors reportedly returned to the market through ETF-related flows.
However, September could present fresh challenges for Bitcoin price growth. Rising oil prices could increase inflation concerns, while changes in Federal Reserve policy could affect investor appetite for risk assets.
Analysts are therefore watching whether Bitcoin can hold the support levels established during its August breakout.
With BTC now trading just below $81,000, investors will closely monitor economic data, ETF flows and regulatory developments to determine whether the rally can continue or enters a period of consolidation.
Do you think Bitcoin can sustain its August momentum despite the economic risks facing markets?
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