As a seasoned researcher with a decade of experience in the cryptocurrency market, I have witnessed the ebb and flow of Bitcoin prices more times than I care to remember. The current dip in Bitcoin’s price, while disheartening for many investors, doesn’t surprise me one bit.
The price of Bitcoin has fallen to its lowest level since late November, diminishing the anticipation for a “Santa Claus rally,” which is typically characterized by substantial increases during the holiday season, particularly towards the end of a market cycle peak.
On the evening of December 23rd, Bitcoin (BTC) dipped to $92,442, marking its lowest point in a month and a 14.5% decrease from its record high of approximately $108,000 that was reached on December 17th.
As a researcher observing the financial market trends, I noticed that the asset briefly recovered to reach around $95,000 at the start of trading on December 24th, but then dipped back down to approximately $94,000. Presently, over the past week, it has dropped more than 11%.
Historically, the crypto market tends to perform favorably around the holiday season when we’re experiencing a bull market. However, Bitcoin’s disappointing December performance has dampened expectations for what is known as the Santa Claus rally – an increase in price during the final five trading days of December and the first two trading days of January.
Interestingly, ‘Mister Crypto’, a crypto trader, observed similar patterns when examining Bitcoin’s past performances. He pointed out significant surges around the festive season between Christmas and New Year in both 2016 and 2020, which were the years leading up to the market cycle’s peak.
According to a study published by CoinGecko on December 13th, it was found that in the period spanning from 2014 to 2023, the crypto market exhibited a ‘Santa Claus rally’ approximately 80% of the time following Christmas. Over a seven-day span, from December 27th to January 2nd, the overall value of the crypto market capitalization increased by anywhere between 0.7% and 11.8%.
2021 didn’t see a typical Santa Claus rally for Bitcoin, as it dropped approximately 26% from its peak of $69,000 by December 25th and kept declining into 2022.
2021 served as the highest point for our cycle, but it’s predicted that 2025 will mark the apex of this same cycle, continuing the four-year trend observed since the creation of Bitcoin.
On December 27th, the cryptocurrency market might experience fluctuations due to approximately $18 billion in Bitcoin and Ether (ETH) option contracts reaching their maturity date.
On December 22nd, the public opinion towards Bitcoin reached its lowest point for the year, potentially indicating an imminent recovery.
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2024-12-24 07:01