Bitcoin stays rangebound with bulls looking to rate cuts and Q4 seasonality: analyst

Bitcoin and crypto markets held a tight range ahead of this week’s U.S. inflation prints, with options markets tilting more defensive and year-end upside increasingly in play, according to a note from onchain options venue Derive.xyz.

According to The Block’s price page, BTC has traded between $108,000 and $112,000 for nearly two weeks, a sign of consolidation after last month’s all-time high. Ether logged similar activity, oscillating between $4,300 and $4,500 over the same period.

Macro-driven volatility

Dr. Sean Dawson, Derive’s head of research, said weaker U.S. jobs data last week increased rate cut expectations and nudged option pricing. The CMEFed Watch tool shows a 100% likelihood of eased interest rates at this month’s Federal Reserve meeting. Prediction markets signaled a corresponding shift. Polymarket now implies a 16% chance of a 50-basis-point cut in September, up from about 10% late last week, while the odds of no cut sit near 3.5%.

Anticipation for a dovish monetary pivot has ushered in more volatility, but "markets appear to have priced in the increased likelihood of rate cuts," Derive’s analysts said. Short-dated ether implied volatility rose to 51% from 34% since Friday but remains below weekly IV around 65%, a setup Dawson says points to “muted price action around CPI, but more movement on broader macro timeframes.”

Skews for both bitcoin and ether have trended lower across 7- and 30-day tenors, signaling stronger demand for puts as traders add downside protection.

Derive’s probability gauges now assign a 23% chance that bitcoin tops $140,000 by Dec. 3, up slightly from 21% last week, and a 23% chance ether exceeds $7,000. On the downside, there’s a 20% chance BTC falls below $100,000 and a 20% chance ETH slips under $3,500.

Institutional flows and seasonal patterns

Flows and tape action remain split by asset, said Timothy Misir, head of research at BRN. Spot bitcoin ETFs took in a net $368 million on Sept. 8, while spot ether ETFs posted $96.7 million in net outflows, extending a six-day run of redemptions.

Still, Misir flagged roughly 396,000 ETH in weekly net exchange withdrawals alongside persistent staking and treasury demand. The tug-of-war between ETF outflows and balance sheet accumulation could either cushion ETH prices for an uptick or trigger a reversal, he added.  “If macro prints are dovish, expect a compressed-vol breakout,” said Misir. “If not, protect and await cleaner entry points.”

The calendar front-loads risk this week, with the U.S. Producer Price Index on Wednesday and Consumer Price Index on Thursday. Until those prints land, analysts expect headline-sensitive, two-way trade, with institutions continuing to pair spot exposure, often via ETFs, with put hedges as skew grinds higher.

Historically bullish Q4

Yet, quarterly data paints a bullish picture. Bitfinex said September’s seasonality argues for consolidation, but Q4 historically delivers outsized gains. According to CoinGlass, BTC historically performs best during the fourth quarter, while ETH usually logs its third-best returns.

On that note, Bitfinex analysts flagged spot ETF flows, bitcoin’s correlation to the S&P 500, and derivatives positioning as important signals to watch.  A September rate cut with dovish guidance would typically weaken the dollar and compress real yields, conditions that have supported bitcoin’s fourth-quarter strength in past cycles, they added.

“The real seasonal opportunity lies in the fourth quarter. October and November have historically been two of BTCʼs strongest months.” the analysts said. They also pointed to July’s Treasury refunding update as market-friendly. The department expanded buyback operations in longer-dated maturities while keeping coupon sizes unchanged, a setup that can help cap spikes in the “term premium,” the extra yield investors demand to hold longer-term bonds.

“Together, these dynamics suggest that if the Fed delivers a cut with dovish guidance and Treasury supply remains orderly, the stage is set for seasonal Q4 strength to express itself.”