Outside Source
Bitcoin has fallen 14.5% from its peak high this month as the cryptocurrency dipped below $92,500 this week.
News
Bitcoin has dropped to its lowest price since late November, dampening hopes of a “Santa Claus rally” that has historically resulted in solid gains over the holiday period in years preceding market cycle peaks.
Bitcoin (BTC) fell to $92,442 during late trading on Dec. 23, its lowest price in four weeks, and a correction of 14.5% from its all-time high of just over $108,000 on Dec. 17.
It briefly rebounded to reclaim $95,000 before falling back to $94,000 during early trading on Dec. 24 and it currently remains down more than 11% over the past week.
Crypto markets have historically performed well through the festive season during bull markets, but Bitcoin’s dismal December performance has quashed hopes of a so-called Santa Claus rally — a price jump during the last five trading days of December through to the first two trading days in January.
However, crypto trader ‘Mister Crypto’ compared Bitcoin’s performance from previous years and noted that there were big rallies between Christmas and New Year in 2016 and 2020, the years preceding the market cycle peak.
Crypto market performance in previous cycles. Source: Mister Crypto
A CoinGecko study released on Dec. 13 revealed that from 2014 to 2023, crypto markets experienced a Santa Claus rally 8 out of 10 times post-Christmas, with total crypto market capitalization jumping between 0.7% to 11.8% over a one-week timeframe from Dec. 27 to Jan. 2.
Santa Claus rallies in previous years. Source: GoinGecko
There was no Santa Claus rally following the cycle peak in 2021 as BTC had fallen around 26% from its high of $69,000 by Christmas day and continued to fall throughout 2022.
The difference is that 2021 was the cycle’s peak year, whereas 2025 is expected to be this cycle’s peak year, following the four-year pattern that has played out since Bitcoin’s inception.
Related: December market correction drags down crypto ETPs by $17B
Crypto markets could be set for volatility on Dec. 27 when around $18 billion worth of Bitcoin and Ether (ETH) options contracts expire.
Bitcoin social sentiment hit its lowest point this year on Dec. 22, which could signal an incoming recovery.
Magazine: BTC correction ‘almost done,’ Haliey Welch speaks out, and more: Hodler’s Digest
This article first appeared at Cointelegraph.com News
