The Red September: Curse or Coincidence? Bitcoin and the Stock Market in Historical Comparison

I still remember my first September as a private investor vividly. The market was merciless—just like every year. Suddenly, I had the feeling that the market was just waiting for me to finally lock in my profits. And sure enough: my portfolio looked like a bear had gone to town on it.
But what’s really behind the “Red September”? Is it truly a curse, or just a statistical quirk that will eventually flip? I dug into the data, pored over psychology and market studies—and discovered something interesting: September isn’t just a bad month. It’s like an unpredictable guest at a party who suddenly sours the mood, even when everyone else wants to celebrate.
The numbers don’t lie—but they only tell part of the story
Looking at Bitcoin data since 2011, September is indeed no friend to the cryptocurrency. In eight of the last 13 years, the asset has taken a hit—especially hard in 2014 (–20%), 2017 (–15%), and 2018 (–17%). Even in a bull market like 2017, when Bitcoin surged over 1,000% for the year, September saw a significant pullback.
But Bitcoin isn’t the only one. The S&P 500, the benchmark US stock index, has posted losses in 40 of the last 95 Septembers since 1928. And its average return of 0.6% falls well short of the yearly average of about 0.8%. Historically, September is the weakest month for stocks—even weaker than October, which is infamous for crashes like 1929 and 1987 but still performs slightly better on average.
Why September? It’s about us
The data is clear, but the reasons behind it are far more interesting. One major factor is psychology. After a strong first half and a volatile summer, September often sees profit-taking. Investors use the month to rebalance portfolios or free up cash for upcoming expenses like tuition or holiday shopping. This creates selling pressure—especially in illiquid markets like crypto, where large orders can quickly trigger steep losses.
Another point is liquidity. September traditionally sees less money flowing into markets as many participants are on vacation or preparing for the fourth quarter. That means thinner order books, where big sell orders can have outsized impacts. Meanwhile, institutional investors are busy wrapping up quarterly reports—a factor that weighs on both stocks and crypto.
2023: An outlier or



the start of a new trend?
2023 was unusual. While Bitcoin had lost ground in most Septembers since 2011, it gained about 4% that year. What changed? For one, hope for a U.S. Bitcoin ETF approval—which did arrive in October. For another, the tech stock sector, which had been under pressure all summer, began to recover.
Even this breakout wasn’t a complete departure from the pattern: by October 2023, a correction followed. The question is whether this was a one-off or a lasting shift. Maybe the answer lies in growing institutional demand for Bitcoin. More funds and companies are integrating crypto into portfolios, which could help stabilize prices. At the same time, Bitcoin’s correlation with stock markets has risen in recent years. Crypto is increasingly seen as a “risk-on” asset.
What can we expect from September 2024?
The signs for the coming September are mixed. On the one hand, Bitcoin is approaching its next halving event in April 2024, which historically has often led to price gains in the months beforehand. On the other, macroeconomic uncertainty—from Fed rate policy to geopolitical tensions—weighs on markets.
If the Fed continues to hike rates, both stocks and crypto could come under pressure. Another risk is liquidity: if major players reduce positions in September, it could spark heavier selling—especially in illiquid crypto markets.
But there’s opportunity too. If inflation keeps falling and the Fed adopts a more dovish stance, risk assets like Bitcoin and tech stocks could regain momentum.
The “Red September”: curse or just a shadow?
The “Red September” isn’t an ironclad rule—it’s a recurring pattern investors shouldn’t ignore. Historical data shows it poses risks for both crypto and stocks. But as 2023 proved, the dynamics can change.
For investors, that means caution—not panic. September should be treated as a monthly challenge, not an inevitable fate. Those who manage positions strategically and prepare for breaks from the pattern can succeed even in this “cursed” month.
Ultimately, the “Red September” is less a curse than a reminder that financial markets are driven by psychology, liquidity, and macroeconomic forces—and that history may rhyme, but never repeats exactly. And sometimes, it only takes a small spark to break the whole pattern.