There are few things more insufferable in financial markets than seasonal indicator discussions. The grandaddy may be «sell in May, then go away,» which gets dragged out every spring, but probably hasn’t been a valid signal since the days of Jesse Livermore, when traders literally sold in May and then headed to the beach for the summer.

A set of seasonal indicators have developed around crypto even as the markets — just a few years old — have far too few observations for anything to be statistically valid. Among the favorites is that August tends to be rough month for prices.

Credit where it’s due, though — the seasonality fans got it right this time, at least for bitcoin (BTC).

Despite continuing inflows in spot ETFs, Federal Reserve Chairman Jerome Powell flipping from hawk to dove, and touching a new record high, bitcoin (with just a few hours left to go), has slipped 8% this month. At just above $108,000 bitcoin has also declined about 13% since hitting that new record above $124,000 on Aug. 13.

The selling has wiped out bitcoin’s summer rally, the price now modestly below its Memorial Day level of $109,500.

Capital isn’t infinite

Bitcoin’s poor record this month stands in stark contrast to that of ether (ETH), which rose 14% in August, thus outperforming BTC by a whopping 2,200 basis points.

Ether’s relative surge came as it attracted large amounts of capital via ETH treasury companies and the spot ETH ETFs.

Launched a few months after the spot BTC ETFs, the ETH funds had seen far more modest inflows than the wildly popular BTC vehicles. That’s changed in a big way of late.

The ETH ETFs this month through Aug. 28 saw $4 billion of inflows versus just $629 million for the BTC ETFs, according to Bloomberg’s James Seyffart. That alone is impressive, but when considering relative market caps — ether’s $500 billion is less than 25% of BTC’s $2.1 trillion — those numbers are far more mind-boggling.

In a world where the U.S. Fed is running a modestly tight monetary policy and fiscal policy is getting tighter thanks to higher tariffs (otherwise known as higher taxes), capital is limited. For crypto in August, at least, that capital was directed to ether, apparently at the expense of bitcoin.

The outlook

First the bad news: seasonality patterns suggest September tends to be even worse for bitcoin than August. In twelve Septembers going back to 2013, bitcoin has declined in eight, according to Glassnode. In the four times BTC managed an advance that month, the gains were fairly modest. All told, the average for September over the last dozen years has been negative 3.8%.

The good news: it’s twelve Septembers and that alone is hardly a large enough sample size to pay attention to. Also, at least seven of those observations (2013-2019) were prior to bitcoin being anything more than a fringe asset and on the radar screen of only a very few investors.