Bitcoin and the rest of the crypto market have been trading sideways for the better part of the year now. However, the tide is starting to turn as there could be a recovery trend for the crypto market very soon. To this end, a crypto founder has identified the best and worst times to be an investor in Bitcoin and other cryptocurrencies. Going by his prediction, the worst could be over for Bitcoin, and the market could be for a great time soon.

Best And Worst Time To Be In Bitcoin

Charles Edwards, founder of digital assets-focused hedge fund Capriole Investments, took to X (formerly Twitter), to share when he thinks is the best a worst time to be in Bitcoin. In the post, Edwards attached a screenshot of quarterly returns for Bitcoin, showing the best and worst-performing quarters.

According to the information, the best quarter for Bitcoin is the last quarter of the year, and the worst is the third quarter of the year. Going by this, it means that the Bitcoin price is currently going through its worst-performing quarter. However, this also means that the downtrend could be nearing its end since the month of September is almost over.

The average returns for the third quarter is shown to be +5.39%, the worst of any quarter. The second worst-performing quarter is the second quarter, but even that remains high at +26.89%, while the median returns for the fourth quarter is actually in the negative at -4.64%, an is the only quarter with a negative median return.

In contrast, the fourth quarter has always been bullish, with average returns of +88.84% and median returns of +56.90%. With less than two weeks left to go in the third quarter, Edwards believes that the worst is over. “If you are still here, congratulations. You made it through the worst time to be in Bitcoin. The best lies ahead,” the post read.

BTC Could Jump To New All-Time High In October

Going by the monthly returns for Bitcoin, as depicted on the Coinglass website, Edwards’ forecast that the decline is almost over looks to be correct. The months of October, November, and December have been some of the most bullish months for the coin in history, and this year could be the exact same.

If this trend holds, then the Bitcoin price could be looking at an average increase of around 20% in October. Such a price increase could set the BTC price on a path to a new all-time high. A continuation of the bullish trend would see the Bitcoin price hit a new all-time high by the time the year 2024 is over.

Featured image created with Dall.E, chart from Tradingview.com

The Federal Reserve instituted a 50-point rate cut, with promising liquidity conditions for a Bitcoin price spike. However, risks abound with cuts this severe, and crypto profits are far from guaranteed.

Global liquidity is very likely to increase, but this might not equal Bitcoin inflows.

Rate Cuts, Liquidity and Bitcoin

The Federal Reserve has decided on a 50-point rate cut, and Bitcoin’s price has been soaring. Given these and broader market trends, many in the community expect a Bitcoin bull market.

However, rate cuts alone cannot guarantee such favorable market conditions; other factors are also crucial. The key to understanding all of this is global liquidity.

At first glance, Bitcoin’s price over the last few weeks has seemed ponderous, sluggish, and indecisive. Upon a closer look, though, it is actually trending closer than ever before. Raoul Pal, CEO and founder of Global Macro Investor, noted that this correlation was “close, very close” throughout 2024.

Compared to previous years’ data on Global Liquidity (L2) and the price of Bitcoin, this year’s proximity is staggering.

In an exclusive interview with BeInCrypto, Adrian Fritz, Head of Research at 21Shares, described the relationship between cuts and liquidity.

“The upcoming Fed rate cut could lead to short-term Bitcoin price volatility. However, the extent of the cut will play a crucial role in shaping market reactions. A more aggressive 50 bps cut could offer short-term liquidity relief,” he added, with obvious importance for Bitcoin,” Fritz said.

The “more aggressive” rate cut has taken place, and Bitcoin has already responded in kind. The dollar is the global reserve currency, and US rate cuts have well-established impacts on liquidity and market risks. Crypto provides an invaluable reservoir of liquidity for international markets, and this dynamic has only increased.

Quinten Francois, co-founder of WeRate, has noted a trend pointing towards a liquidity spike, and Bitcoin will surely benefit from it. Seems simple, right?

Read More: Bitcoin Halving History: Everything You Need To Know

Dangers in a Volatile Market

Rob Viglione, CEO of Horizen Labs, also discussed these dynamics with BeInCrypto. Like Fritz, he also expected a 25-point rate cut:

“Since a 25 basis point cut is largely expected, major price swings are unlikely, but the direction of travel in the short term will likely be positive as investors move to more volatile assets. In the longer term, lower interest rates will continue to favor risk-on assets like Bitcoin, as investors continue to seek higher returns outside of traditional investments,” Viglione claimed.

However, both underestimated the extent of these cuts. Viglione said that major price swings were unlikely in a 25-point scenario, but cuts are much more severe.

In other words, the market could be set up for a major spike. There are hazards, too, though, that may stand between Bitcoin and a big score.

“A 50-point cut may also heighten concerns about deeper economic challenges or the risk of an impending recession, which could trigger a price pullback. This is especially relevant considering Bitcoin’s recent failure to break through the $60,000 mark and September’s historically poor performance for both Bitcoin and broader markets,” Fritz concluded.

Thankfully, Bitcoin has already broken through $60,000. Bitcoin is viewed, perhaps incorrectly, as a risk-on asset, and lowered interest rates do benefit these. For now, all the conitions seem reasonable to expect a price spike, provided that investor confidence remains high. Nobody can know the future, but we may indeed see $100,000 Bitcoin sooner than we think.

Bitcoin (BTC) reacted to the Federal Open Market Committee (FOMC) meeting on Wednesday, which showed policymakers resorted to a 50 (0.50%) basis points (bps) interest rate cut for September.

This decision marks the beginning of an easing cycle, with more rate cuts to come in 2024.

FOMC Cuts Interest Rates, Bitcoin Jumps Over $60,000

The Federal Reserve has cut interest rates by 50 basis points, the first reduction since early 2020. Financial markets, including crypto investors, had been expecting this move as policymakers aim to control inflation while promoting job growth.

This rate cut comes after the August Consumer Price Index (CPI) showed inflation cooling to 2.5%, down from 2.9% in July. A weaker jobs market and easing inflation have pushed the Fed to lower borrowing costs, hoping to keep the economy steady.

“I think those rate cuts are going to happen faster than we predict. Why? The labor markets and economy are getting worse at an accelerated pace,” analyst Michael van de Poppe shared ahead of the release.

Read more: How to Protect Yourself From Inflation Using Cryptocurrency

Despite the rate cut, the Federal Reserve remains cautious about inflation risks and stands ready to adjust its policies as needed to maintain market stability. This decision is significant because it directly impacts the broader economy, influencing both families and businesses across the US

Higher interest rates typically make borrowing more expensive, whereas lower rates ease access to loans, stimulating spending and investment. This increased liquidity can benefit riskier assets like Bitcoin and stocks, which often see gains when borrowing costs drop.

Historically, interest rate cuts have boosted assets like Bitcoin. For example, following the Fed’s March 2020 rate cut, Bitcoin surged as investors sought to capitalize on lower borrowing costs amid the economic uncertainty triggered by the pandemic.

Read more: How To Buy Bitcoin (BTC) and Everything You Need To Know

BeInCrypto data shows BTC is trading for $60,730 as of this writing.