Bitcoin, Ethereum hold steady as crypto braces for a historically brutal September

• The crypto market is bracing for “Red September,” its historically worst month.
• The Crypto Fear and Greed Index has plummeted into the “fear” zone.
• Bitcoin is holding critical support around the 108,000 dollar level for now.

A fragile and deceptive calm has settled over the cryptocurrency market as September begins, a quiet start to what history warns is the cruelest and most unforgiving month of the year.

While prices are holding steady for now, a powerful undercurrent of fear is gripping traders, as seasonal weakness collides with a high-stakes macroeconomic picture, setting the stage for a potentially volatile and brutal few weeks.

The shift in sentiment has been swift and severe.

The Crypto Fear and Greed Index, a key barometer of market psychology, has plummeted from a confident 75 out of 100 in mid-August to just 46 today, plunging the market from “neutral” territory deep into the “fear” zone.

It is the worst reading since the dark days of mid-June.

This growing anxiety is rooted in the hard data of market history. Since 2013, Bitcoin has dropped an average of 3.77 percent every September, a grim and consistent pattern that has earned the month its ominous nickname: “Red September.”

The Battle for $108,000

For now, a tense battle is being waged on the charts. Bitcoin is showing a flicker of resilience, holding above the psychologically critical $108,000 support level.

But a deeper look at the technical indicators reveals a market on a knife’s edge, caught in a state of profound indecision.

The Average Directional Index (ADX) is hovering at 20, a reading that suggests a choppy, directionless market.

At the same time, the Relative Strength Index (RSI) at 40 is flashing a clear warning: the “Red September” effect is taking hold, with selling pressure beginning to dominate.

The Squeeze Momentum Indicator confirms this, showing that while a big move may not be imminent, the underlying trend remains distinctly bearish.

The most telling sign may be in the exponential moving averages (EMAs). While the broader configuration remains bullish, with the 50-day EMA above the 200-day EMA, the gap between the two is ominously starting to close.

This signals a dangerous deceleration of the bullish trend and raises the specter of a “death cross,” a technical pattern that would confirm a deep and protracted bear market.

The shadow of the Fed looms large

This internal market struggle is playing out under the long shadow of the Federal Reserve.

The central bank’s upcoming policy meeting on September 16-17 may well be one of the most contentious in years, a pivotal showdown that could determine the fate of all risk assets.

With markets currently implying an 87 percent chance of a quarter-point rate cut, the crypto market is trapped between the rock of seasonal weakness and the hard place of potential monetary relief.

Prediction markets are reflecting this bearish tilt.

On Myriad, traders now give Bitcoin a 75 percent chance of dropping to 105,000 dollars in the near future, a stunning reversal from just two weeks ago when the same market was pricing in a 90 percent chance of a surge to 125,000 dollars.

The storm clouds are gathering, and the calm of this early September morning may not last for long.