September Looms as Weakest Month for Wall Street and Crypto After August Gains

September has historically been the worst-performing month for US stocks and cryptocurrencies. The S&P 500 closed August with a gain of more than 2% and achieved multiple record highs during the period.

Both Bitcoin (BTC) and Ethereum (ETH) wrapped up the month on a strong note, posting gains of 24.95% and 32.5% respectively. Historical patterns suggest a more difficult period ahead for the two markets.

September Has a Lengthy Track Record of Declines for Stocks

Since 1950, the Dow Jones Industrial Average has dropped an average of 0.8% in September, per the 2026 Stock Trader’s Almanac. Over the same period, the S&P 500 has lost 0.7%.

Since 1971, the Nasdaq Composite has declined 0.9%, and the small-cap Russell 2000 has fallen 0.8% since 1979. According to Bank of America data going back to 1928, the S&P 500 has averaged a 1.17% loss in September, dropping in 56% of those years.

Jeffrey Hirsch and Christopher Mistal, authors of the Almanac, attribute this trend to how funds manage portfolios after the summer recess.

“Portfolio managers back after Labor Day tend to clean house in September,” they said.

This comes after a robust August for equities. The S&P 500 gained more than 2%, closing at a record 7,798.99 on August 13 — its 27th record close of 2026. The Dow rose more than 1%.

The rally was fueled by corporate earnings. Second-quarter pre-tax profits hit $4.8 trillion, the largest share since at least 1950.

Against that background, several headwinds have emerged. For the first time in more than a month, the US and Iran traded strikes. July personal consumption expenditures inflation stood at 3.7%, close to twice the Federal Reserve's 2% target.

JC O’Hara, chief technical strategist at Roth, noted that midterm election years have historically caused volatility in September and October.

Cryptocurrencies Share the Same Seasonal Weakness

Digital assets have a similar seasonal track record. Since 2013, Bitcoin has averaged a 2.87% drop in September, its worst month, with a median decline of 2.44%, according to Coinglass.

Ethereum exhibits a larger disparity. Since 2015, the asset has averaged a 9.40% September decline, with a median fall of 9.14%, per CryptoRank.

Nevertheless, recent performance complicates this trend. BTC has finished higher in each of the last three Septembers, advancing 5.16% in 2025 and 7.29% in 2024. ETH increased 3.20% in September 2024.

Both assets also come into September with strong momentum. BTC rose 24.95% in August, and ETH gained 32.5%.

Stock market seasonality has also moderated similarly. The S&P 500 increased 2.02% in September 2024 and 3.5% in 2025, consecutive gains that defy the long-term average.

This September, the seasonal challenge coincides with midterm elections, inflation exceeding the target, and rising crude oil prices.