The Crypto Market Outlook for the Santa Claus Rally
Traders are optimistic about Bitcoin and other major altcoins as the US inflation data cools down and the US Federal Reserve prepares to change its stance next year.
Although the major trading markets are on vacation for Christmas, the crypto market remains open. However, market activity is low due to the holiday season. There are no significant macro events this week, apart from jobs data and short-term treasury bill auctions, and no major crypto-related events either.
The only notable events affecting the crypto market are the end of BUSD support, which may lead to crypto withdrawals, and stablecoin flows at the end of the year. However, these events are unlikely to have a significant impact on the overall market.
The upcoming annual options delivery on Friday will be an important event to watch. Nearly half of Bitcoin and Ethereum options positions will face delivery, which could prompt traders to take new positions based on factors such as anticipated spot Bitcoin ETF approval, Bitcoin halving, and technical charts.
Other potential factors that could influence Bitcoin price include the slip in the U.S. Dollar Index (DXY) to 101.71 and the 10-year Treasury yield falling to a 6-month low.
Bitcoin’s Price Decline and Altcoins’ Rise on Christmas
Bitcoin’s price has remained stagnant around the $43,000 mark while altcoins have taken the lead on Christmas. In the past 24 hours, BTC price fell by 1%, but an increase in trading volume suggests a possible rebound.
Crypto analysts maintain a bullish outlook for Bitcoin. CredibleCrypto stated, “Absolutely primed for the next leg up – hopefully we get one more quick swipe into low 43k’s to fill a few more of my bids first.” The market expects BTC price to reach $50k in the near future.
Top altcoins like ETH, SOL, BNB, XRP, ADA, and AVAX experienced pullbacks after showing strong upward momentum earlier this week. Traders are keeping an eye on trading volumes in both spot and derivatives markets for a potential Santa Claus rally next week.
On Christmas, AXS, QNT, ORDI, KDA, SEI, MINA, and other altcoins have been the top gainers in the crypto market. AXS and KDA prices have surged by over 30% and 60%, respectively.
Hot Take: Altcoins Shine on Christmas as Bitcoin Consolidates
While Bitcoin’s price remains relatively stagnant on Christmas, altcoins have shown significant gains. This divergence in performance has sparked optimism among traders who are anticipating a Santa Claus rally in the crypto market.
The US CPI and PCE inflation data cooling down and the upcoming pivot of the US Federal Reserve have contributed to the bullish sentiment surrounding Bitcoin and major altcoins. Additionally, factors such as the potential approval of a spot Bitcoin ETF and technical chart patterns are influencing traders’ decisions.
As we head into the new year, all eyes will be on the annual options delivery event and its impact on Bitcoin and Ethereum. Meanwhile, altcoins like ETH, SOL, BNB, XRP, ADA, AVAX, AXS, QNT, ORDI, KDA, SEI, and MINA continue to attract attention with their impressive gains.
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